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WESTERN EFFICIENCY SOCIETY 

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THE HUMAN FACTOR 



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INDUSTRIAL PREPAREDNESS 



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Complete Report of the Proceedings 
of the 

National Conference 



Under the Auspices of the 

Western Efficiency Society 

CHICAGO 

May 23, 24. 25, 1917 






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WESTERN EFFICIENCY SOCIETY 

327 South La Salle Street 
CHICAGO 



ORGANIZED DECEMBER 1912 



INCORPORATED FEBRUARY 1913 



OFFICERS 1917 



H. THORPE KESSLER 
W. S. FORD 
A. B. SEGUR 
GEORGE C. DENT 



President 

First Vice President 

Second Vice President 

Secretary-Treasurer 



DIRECTORS 1917 



F. M. Simons, Jr., Chairman 

W. F. Smith - 

Irving A. Berndt 

J. F. Henning 

H. Thorpe Kessler 

H. A. Rose - 

D. S Curtis 

W.S.Ford - 
George C. Dent 



University of Chicago 

Marshall Field & Co. 

Joseph T. Ryerson & Son 

Vesta Accumulator Company 

Rosenwald & Weil 

- Selz, Schwab & Company 

- Marshall Field & Co. 
Zion City, III. 

The Seng Company 

Secretary-Treasurer 



WESTERN EFFICIENCY SOCIETY 



OFFICERS 1916 

J. F. HENNING - - President 

J. R. BENTLEY - - First Vice President 

D. S. CURTIS - - Second Vice President 

GEORGE C. DENT - Secretary-Treasurer 



DIRECTORS 1916 

H. THORPE KESSLER, Chairman 
W. F. SMITH - - J. F. HENNING 

I. A. BERNDT - - J. R. BENTLEY 

H. A. ROSE - - W. A. BENNETT 

M. A. NYGAARD - - GEORGE C. DENT 



OFFICERS 1915 

I. A. BERNDT - - President 

H. THORPE KESSLER - First Vice President 

M. S. GREEN - Second Vice President 

GEORGE C. DENT - Secretary-Treasurer 



DIRECTORS 1915 

J. F. HENNING, Chairman 
H. T. KESSLER - - LA. BERNDT 

W. F. SMITH - - W. A. BENNETT 

M .A. NYGAARD - - GEORGE C DE NT 



WESTERN EFFICIENCY SOCIETY 



OFFICERS 1914 

W. F. SMITH - - President 

J. F. HENNING - - First Vice President 

H. THORPE KESSLER - Second Vice President 

GEORGE C. DENT - - Secretary-Treasurer 



DIRECTORS 1914 

I. A. BERNDT, Chairman 
H C. FURNEAUX - - W. F. SMITH 

J. F. HENNING - - H. A. ROSE 

F. F. MAIN - - - GEORGE C. DENT 



OFFICERS 1913 

W. F. SMITH - - - President 

H. C. FURNEAUX - First Vice President 

PAUL BUTLER - - Second Vice President 

GEORGE C. DENT- - Secretary-Treasurer 



DIRECTORS 1913 

I. A. BERNDT, Chairman 
H. A. ROSE - - - F. F. MAIN 

H. C. FURNEAUX - - PAUL BUTLER 

W F. SMITH - - - GEORGE C. DENT 



NATIONAL CONFERENCE COMMITTEES 



Executive : 

I. A. Berndt. F. M. Simons, Jr., H. T. Kessler, H. A. Rose, G. C. Dent 

Program : 

F. M. Simons, Jr. 

Publicity: 

I. A. Berndt, H. T. Kessler, H. A. Rose, G. C. Dent 

Hotel Arrangements: 

G. C. Dent 

Exhibits: 

W. S. Ford, F. A. Carlisle, C. H. Burns, A. B. Segur, H. F. Porter, D. S. Ullrick, 
H.P. Gould, B. P. Mast 

Registration: 

W. F. Smith, D. H. Gifford, H. C. Furneaux, L. A. Blue, E. J. Dick, W. E. Burr 
F. R. Mason, C. D. Marco, C J. Norris, H. L. Trube, J. T. Bloomburg 
W. Bethke, H. Rowe, H. G. Dent, B. E. Boiling, H. H. Muir 

Round Table: 

A. B. Segur, W. R. DeField, H. C. Alger, S. E. Stout 

Ladies' Reception: 

Mrs. E. Beatty, Mrs. E. Cobb, Miss A. B. Gantz, Miss Dorothy Dent 

Reception ; 

J. F. Henning, F. A. Grohsmeyer, A. G. Bryant, W. A. Bennett, H. P. Dutton' 
N. D. Gaston, A. A. Goes, Homer Kessler, S. T. A. Loftis, E. H. Lunde, 
F. F. Main, P. H. Meyers, E. A. Parsons, H. B. Price, S. M. Ross, 
R. E. Richardson, W. A. Sittig, Robert Spurgin, Jr., E. H. Scull, J. R. Shea, 
S. W. Koenig, N. W. Rubel, R. W. Cornelius, J. R. Richardson, C. 0. Dicken, 
F. E. Dixon, J. S. Townsend, A. F. Trever, M. A. Nygaard, L. E. Farrem 
J. H. Ensminger 

Dinner: 

H. A. Rose, L T. Biddle, Hodgson Jolly 



CONTENTS 



Page 

"The Western Efficiency Society," F. M. Simons, Jr 12 

"The Purpose of the National Conference," Irving A. Berndt 14 

"The Importance of the Human Factor in Industrial Preparedness," 

C. E. Knoeppel, • 17 

"Educating the Management to the Importance of the Human Factor," 

Harrington Emerson 49 

(a) "Training the Future Generation — Function of the Educa- 

tional Institution," Willard E. Hotchkiss 57 

(b) "What Industry Can Do for Itself," J. W. Dietz 65 

(c) "Training the Coming Generation of Workers and Execu- 

tives," E. W. Puckett 70 

Round Table Discussion — -"Influencing the Management" 73 

"Employment Problems" — ■ 

(a) "Stabilizing Our Labor Units," W. A. Grieves 98 

(b) "The Hart, Shaffner & Marx Plan," Earl Dean Howard.... Ill 

(c) "Factors Influencing Labor Turnover," Irving A. Berndt.. 114 

"Labor and Industrial Preparedness," John P. Frey. 125 

Round Table Discussion — "Labor's Viewpoint" 144 

"Safety First," Harry' F. Porter 153 

"Corporation School Movement," W. R. DeField. 159 

"Woman's Work in War Time," W. S. MacArthur 163 

Prohibition a War Measure, H. J. Stauffer 171 

"Measurement and Stardardization," Frank B. Gilbreth 178 

"Governmental Control of Industries" Charles R. Van Hise, Ph. D.... 189 

"The Proposed Society of Industrial Engineers," C. E. Knoeppel 204 

"The Results of the Conference," I. A. Berndt , 206 



OPENING SESSION 

WEDNESDAY AFTERNOON, MAY 23, 1917 
Mr. H. Thorpe Kessler, President, in the Chair. 

CHAIRMAN — Ladies and Gentlemen, Delegates, Guests and Members : 

There are gathered here today from various parts of this country, in 
Conference, industrial engineers, men from prominent commercial and tech- 
nical organizations, to consider one of the most vital problems confronting 
the country — "The Human Factor in Industrial Preparedness." 

The Council of National Defense has definitely and fully explained the 
intent of its recommendation that "neither employers nor employes shall 
endeavor to take advantage of the country's necessities to change existing 
standards." 

Our problem then is to meet the new changes under existing standards. 

The men who will address you at the various sessions are peculiarly and 
well fitted to answer this question. 

The advent of the war has intensified the desire to protect the existing 
standards of labor. Our efforts and the energies of labor forces must be 
well directed to secure maximum usefulness in the present critical situation. 

Industrial Preparedness is as important as the wise conduct of those 
Government departments directly associated with the prosecution of the war 
today. The attitude of labor — the problems of management — the proper 
Governmental control of industries are all problems demanding impartial and 
thoughtful consideration. 

Those of us who are not called or fitted to take part in fighting on land 
or sea have a patriotic duty to perform. 

In the President's ringing appeal to the people of this country there is a 
reminder that more can be produced, more can be saved, industries can be 
more economically managed than under ordinary conditions of national life 
and action. It then becomes our duty — our opportunity to devote our thought 
and energy to evolve and construct ways and means of producing more with 
a minimum of changes from existing labor conditions. 

The Western Efficiency Society is gratified with the splendid support 
given it by the Chicago Association of Commerce, and the local and outside 
Efficiency Societies. 

It is our desire that the delegates and visitors feel that we are one large 
family.^ Acquaint yourselves one with the other. 

It is our wish that everyone present at this and succeeding meetings will 
feel at liberty to enter into the informal discussions. 

Members please rise and give visiting delegates a rousing welcome. 

U 



Western Efficiency Society Conference 



CHAIRMAN: Mr. F. M. Simons, Jr., chairman of the Board of Direct- 
ors, will explain for the benefit of delegates and visitors the various activities 
of the Western Efficiency Society, and what it is striving to accomplish. 

MR. F. M. SIMONS, JR.: Mr. President, Members and Guests: The 
Western Efficiency Society is a big topic to try to handle in a few minutes. 
The President has limited me in that way, you see. My wife has come down 
here for the express purpose of seeing that I didn't speak too long; she 
warned me about that before I came, so I have got to be good, no matter 
how much I want to tell you. 

First, a word about the historical development of this Society. Person- 
ally, I feel absolutely unqualified to handle this side of the topic. I have not 
come up through the growth that the Society has experienced. I was not one 
of the charter members. I do think, however, that this is an appropriate 
time for just a word of appreciation of the work of those men who have been 
here from the beginning, and through whose efforts and unselfish work the 
present status of the Western Efficiency Society has been attained. Men 
like Mr. Dent and Mr. Berndt, and the rest of you — I am not going to 
attempt to name them because I should be sure to miss some of them, but I 
do think that those of us who have come in toward the end should take our 
hats off to these men who have lived through the early fight. 

I have for the present just one or two thoughts. In an informal way> I 
would like to first say a word about the ideals of our organization, and then, 
very briefly, outline some of the work it is attempting to do. 

There are just two things that come to my mind in the way of ideals. 
Many other things might be said, but these things are on my mind, and I 
am just going to say them very informally. 

First, it seems to me that this Society stands as near as any organization 
of its kind could be expected to stand, for democracy. We believe in the 
democratic organization and promotion of this work. This has a number of 
applications. In the first place, this Society has not endorsed and will not 
endorse any individual propaganda in connection with efficiency work. We 
are back of any good movement that is fulfilling its place in this field. We 
recognize, therefore, no one type of management. 

Another aspect of the matter is the question of the various interests in 
the field. There is, of course, the manufacturing interest, the commercial 
interest, financial interest, and so forth, and we have tried sincerely not to 
limit our work to any one field. We have tried to keep our range wide and 
to maintain a democratic interest in the work in that way. It is interesting 
enough that within the very first year of the Western's growth that sex lines 
were wiped out, and that some of our most active members are business 
women. Again, the men who ate doing the work of this Society represent 
no one group. There are men interested primarily in the factory, men who 
are the executives, there are men who are under these excutives, there are 
men who are office managers, and men who are working under these office 
managers. 

I was very much interested in looking' over the Western Efficiency Soci- 
ety booklet gotten out a few years ago to note that one of the first things said 
about this Society was that it was an educational institution. I think that in 

12 



The Importance of the Human Factor in Industrial Preparedness 

a very broad way the Western Efficiency Society feels that it is an educational 
institution, and that we have kept that thing in mind throughout all our 
work. The first point, then, is that we are trying to do our work in a demo- 
cratic way. 

One other thing- by way of ideals, and that is that we are trying to keep 
a very high level of professional ethics before us as we do this work. That 
means, or may mean, that the Society will tread on the toes of some people. 
Personally, I hope that in the future we will. It seems to me that the Society 
if it did in that line what it should do, that there will be some toe-treading, 
but that is not the main thing that I wish to emphasize. It is that long run 
success in this movement depends, it seems to me, more on this one thing than 
on any other thing, that you, that we, would be unwilling to do things in this 
movement which would not meet our ideals as to what should constitute a 
code of professional ethics. What that code is at the present time no one 
can say. That is, the movement is so new it hasn't had time to crystallize, 
and I think it would be unfortunate at the present time to try to work out a 
code of that sort. But it is nevertheless a very real though informal code 
that most of us have in mind: (1) the democratic idea and (2) this idea of 
keeping a high standard of ethics. These things are not always easy to 
work out side by side. 

As a concrete illustration of that, I would like to just mention one 
thing. At the present time, in order to keep professional standards high, 
the Membership Committee of the Board of Directors is trying to work out a 
scheme which will give recognition to men who have accomplished some- 
thing in this field. Up to date we have been unwilling to even present that 
scheme to the Society, because of the fear — much as we believe that that 
thing is necessary, and that it must be done — because of the fear that there 
is danger in it of losing this democratic spirit that has been one of the out- 
standing features of our work up to the present time. 

Those two things are important, but they do not always work out. It is 
not always possible to work them out in a very satisfactory way. We are 
trying to do it, that is the big job ahead of us. 

Now for the work of the Society. I think that from the bulletins and the 
various literature of the Society that you can get, this is very plainly shown. 
It is not necessary to say very much about it. I do believe that for an organi- 
zation of this kind there is one thing that should be emphasized. Important 
as the meetings are, important as our informal personal meetings are, I think 
that the thing that probably has done more than any other one thing, that has 
made the engineering societies for instance, like the A. S. M. E. and kindred 
societies, great, and has made their work lasting, has been the research work 
they have done, and I feel that whatever you may call it, that this organiza- 
tion or every other organization of this kind must do some lasting work of 
that character. We are doing that and we are also doing more informal 
work. 

So much for the present work of our organization, as to its ideals, as to 
its tasks. What the future has in store for us none of us can tell. The 
future of this organization, of course, depends on the organization itself. We 
feel that if this organization hasn't a future, that we alone are to blame. 

13 



Western Efficiency Society Conference 



The movement is oversold, and the time is ripe for a big expansion of our 
work. I believe personally that there is no question at all but that that 
expansion is coming, that it is here, and that this organization is going to 
have a much wider, a much broader sphere of influence than it has had, 
important as that may have been. (Applause.) 

CHAIRMAN— Mr. Irving A. Berndt, who is one of the four men that 
conceived the idea of the Western Efficiency Society nearly five years ago, 
is going to explain to us the "Purpose of the National Conference." Mr. 
Irving Berndt. (Applause.) 

MR. IRVING A. BERNDT.— Mr. President, Members and Guests : This 
was such an important item in my mind that I made it a special point to 
write out my notes on the ideals of the Conference Committee, and correct 
them, so that there would be no mistake about how the matter stands. I 
am going to read that. 

PURPOSES OF THE NATIONAL CONFERENCE 

By I. A. Berndt 

For many a month previous to President Wilson's notable and historical 
address to Congress, declaring the existence of a state of war between the 
United States and Germany, an appreciation had been growing on many of 
us that if this country is to make the most of its opportunities in the 

world of commerce and industry, we must pay particular attention to the 
human element. 

The factors leading up to such conclusions are many, and will be empha- 
sized by the various speakers on the program of this conference. 

The very minute war was declared, this emergency became a national 
crisis. We know that important as man-power had become before the dec- 
laration of war, its importance was multiplied after it, because of the millions 
of men who would be drawn into the Army and Navy and the manufacture 
of war supplies, as well as to serve the greater demands which would be 
made on our industries to supply the wants of our allies. 

With a knowledge of this crisis, The Western Efficiency Society felt 
that by planning to bring together in conference the best available thought 
on this subject, much light would be thrown on the problem, and with this 
talent gathered from all parts of the country, constructive recommendations 
must result which, if followed by our industries and our government, would 
do much to relieve the situation. 

The value of this conference and its importance have been very aptly 
stated in an editorial in the Chicago Herald last Sunday morning, reading as 
follows : 

THE HUMAN FACTOR 

"The Western Efficiency Society has done well in directing the emphasis 
of its coming conference toward "the human factor in industrial prepared- 
ness." For upon the efficiency of that living element depends the success 
or the failure of America in world war." 

"An acute student of the European developments of the war period has 

14 



The Importance oe the Human Factor in Industrial Preparedness 

asserted that the democracies of France and England have been able to 
place a heavier burden on the workers than have the autocrats of Germany. 
.The manifest reason for this is to be found in the fact that the French and 
English workers voluntarily chose to sacrifice the restrictions and immuni- 
ties which they had won while the German regulations were established 
by the state. But even thus it was learned that the English operatives had 
attempted too killing a pace. 

"They had tried to run a Marathon race at a hundred yard dash speed. 
Consequently, the human factor began to fag and production failed. The 
industrial army was willing to endure almost any strain, but its efficiency 
was reduced when hours were too long and the work too continuous. The 
sheer necessity for more and more munitions thus accomplished changes in 
Great Britain which previously had been considered only as items in social 
reform. 

"Governmental bodies are familiar with this lesson. What Washington 
knows cannot rule the country, however, unless public opinion in the nation 
offers its support. The efficiency society accordingly may render valuable 
service in stimulating thought about the men and women and children 
whose hands must fashion victory or defeat for the United States." 

Besides the very definite constructive moves which will be recommended 
as a result of this conference, and in order to make permanent the organized 
thought represented in our Conference program, it is planned, as announced, 
to arrange for the possible organization of a National Society of Industrial 
Engineers next Saturday at 10 A. M. Further information regarding this 
organization will be given at the various sessions of the Conference. All 
interested are requested to register for this meeting at the registration desk. 
It is our ideal to make our conference eminently constructive, in a 
national crisis. 

THE CHAIRMAN : Mr. George C. Dent, the secretary of the West- 
ern Efficiency Society, was its first secretary, and has been the secretary 
since the inception of the Society. At the one hundredth meeting of the 
Society, held last evening, a resolution of gratitude and thanks was extended 
to Mr. Dent, because he has been one hundred per cent efficient in his at- 
tendance ; he has not missed one of the one hundred meetings. (Applause.) 
Mr. Dent will read the official announcements and the official business 
of the Society. 

Mr. George C. Dent read telegrams from Theodore Roosevelt and Chas. 
M. Schwab, in which they expressed their hearty co-operation in the move- 
ment to arouse national attention to the importance of "The Human Factor 
in Industrial Preparedness" and regretted previous engagements would not 
permit of their attending the Conference and taking an active part in the 
work, 
fort and entertainment of delegates and visitors. 

Mr. Dent next told of the arrangements made for visitors to inspect 

various plants in Chicago, plans for the entertainment of the ladies, and 

of courtesies extended by Western Efficiency Society members for the com- 

THE CHAIRMAN: Possibly the speaker of the afternoon is better 

15 



The Importance of the Hum an Factor in Industrial Preparedness 

known by his book on Industrial Preparedness, which has been called to 
the attention of this government. Mr. Knoeppel has been in Washington 
a number of times during the past two years and has been called into con- 
ferences in connection with the present situation. There are very few men 
in this country that have had the vision and the foresight to see the condi- 
tions which now exist today, and which industries generally appreciate. 
In 1911 Mr. Knoeppel in his book called "Maximum Production," said: 
"There is a task ahead of this nation, a task of such a magnitude as to war- 
rant executives giving- it their earnest and careful consideration, as well as 
to attract the attention of those who are in a position through training 
and natural ability, to assist in solving the many problems directly bear- 
ing on the question of increasing the efficiency of human endeavor." Mr. 
Knoeppel is a disciple and follower of Mr. Harrington Emerson. It gives 
me very great pleasure, this afternoon, to present Mr. Knoeppel. 

MR. C. E. KNOEPPEL: Mr. President, Members of the Western 
Efficiency Society, Ladies and Gentlemen : Before I get into the body of 
the talk which I have prepared, I want to read a letter from Howard E. 
Coffin, of the Advisory Committee, Council of National Defense, written 
May 19th: 

"Dear Mr. Knoeppel : Will you kindly extend to the Western Effi- 
ciency Society my best wishes for the complete success of the National 
Conference. Our country is embarking upon an industrial and military 
activity which 'bids fair to tax even its tremendous resources to the limit. 
Our task is not one of a month or of six months, but may extend over a 
period of years. There can be no withdrawal from the position we have 
taken. No other issue than that of victory will be acceptable to us, but to 
achieve this result we must be prepared to concentrate our effort and every 
ounce of our great power, both in materials and in men. 

"It lies within the province of our efficiency engineers to play an im- 
portant part in this great work. To conserve our resources and to make 
efficient our expenditures and effort in money, in materials and in men, 
will, sooner or later, require the concentration of our industrial engineers 
in every line. To effect a national organization of such character as w r ill 
provide the government a single channel of contact with that group of men 
peculiarly skilled in the promotion of industrial efficiency should be the great- 
est work of the Chicago Conference. 

"Good luck, more power to you." (Applause.") 

THE IMPORTANCE OF THE HUMAN FACTOR IN INDUSTRIAL 

PREPAREDNESS. 

I am not unmindful of the distinct honor conferred upon me by your 
Society, in asking me to deliver this opening address, nor do I underestimate 
the nature of the task that confronts me in attempting, insofar as I am able, 
to sound the key-note at this conference, which I can promise you is going 
to make history. 

With most of the peoples of the earth stark raving mad, and at each 

17 



Western Efficiency Society Conference 



other's throats ; with nearly all of the nations of the globe divided into two 
gigantic camps, each trying to annihilate the other; with both spending 
money like drunken sailors and destroying life and property as if there were 
no such thing as posterity to bear the horrible load ; with each trying to 
outdo the other in the display of cunning, of devilish skill in developing 
mechanisms to kill and destroy, the injunction "come let us reason together" 
should be of unusual significance to those of us gathered together, con- 
fronting as we are the most critical time in our history — that of finishing 
this war and preparing for the aftermath. 

We are at the parting of the ways. 

No longer can we continue in the wasteful, pleasure-seeking and ex- 
travagant path we have been traveling in the past, and continue to survive 
as a nation, for the very good reason that a strong and vigorous power, 
whose gospel of "might makes right ;" whose utter disregard for all the laws 
of humanity and international contact and intercourse, is every day doing 
its utmost, to dominate and force its will on the rest of the world. 

In this conflict of autocracy against democracy; of the rule of "divine 
right" as against the rule of a free people, the final decision is going to rest 
with the United States of America — you and I. How we decide depends 
entirely on whether we look upon this conflict as a six round sparring con- 
test, or a gruelling prizefight with bare fists and no ring rules; whether we 
consider it just another border skirmish or a war of the most hellish variety. 

In New York I was told that Italy could not move her navy because it 
did not have coal for the fleet, and could not get any because England could 
not spare the ships in which to send it; that France was on her knees and 
calling her 1918 boys to the colors, with her industries facing a serious con- 
dition due to a shortage of coal and her people looking forward to a dismal 
and cold winter for the same reason ; that England was facing a serious food 
situation and that the curve of U-Boat tonnage destruction was slowly but 
steadily increasing, with new German submarines being built at the rate of 
three per week. 

Only a few days ago Lord Derby, England's Secretary of State for War, 
said that this war will not be over until the full weight of America has 
been thrown into the scales, not until America begins making war as though 
she alone faced Germany and that the bigger the blow America is able to 
deliver and the sooner she delivers it, the quicker will the war end and the 
new order of things be assured. He asked us to be on our guard against 
German propaganda, which aims to convince the world that the war will 
soon be over, that Germany would be willing to make peace — on her own 
terms — but not for a long time on the terms that democracy will force her 
to consider. 

We all know the situation in Russia. One day there is an improvement 
in conditions while the next brings resignations and disorder, the effect of 
which is demoralization both in the army and in the government, all of 
which assists Germany materially. Kerensky, the Minister of Justice, re- 
cently said: 

"As affairs are going now, it will be impossible to save the country." 

18 



The Importance of the Human Factor in Industrial Preparedness 

Following this comes the resignation of Mulikoff, the most constructive man 
in Russia today, a hard blow to the Allies indeed. 

I am not a calamity shouter, attempting' to feed you pessimistic pills. 
I have had an opportunity, however, to get in touch with the kind of facts 
which convict our people of the lack of a real appreciation of the task ahead 
of this nation, great as it is in natural resources, in financial strength and in 
men. I see in many of our people the Mr. Britling we have all read about, 
who could not see such a thing as war at first, and when it came felt that it 
was a "bally little mess" that the regulars would fix in short order, but 
when confronted with the real facts, when the war was brought home to 
him through the death of his son, he became grimly determined and "saw it 
through." 

We are going to see it through, but to do so without passing over the 
same road that Mr. Britling took, we must realize that each and every one of 
us must "get down to brass tacks," for barring miracles, and miracles should 
not for a moment enter into our calculations, the experts say that a long 
struggle is ahead of us before Germany can be decisively beaten, as decis- 
ively beaten she must be. 

As Roosevelt well said recently: 

"If we are to cure ourselves, it must be by our own exertions ; our 
destiny will certainly not be shaped for us as was Germany's by a few 
towering autocrats of genius, such as Bismarck and Moltke." 

The time for talking, for criticism, for ridicule, is over — from now on 
our slogan must be ACTION; action of the most vigorous kind; action in 
which individual differences must be forgotten; action in which everyone 
must put their shoulders to the wheel and with a mighty heave, do their 
bit in making this old world of ours a proper and fit place for ourselves 
and our children to live in. 

Just a word of caution, however. Let this people line its coasts with 
batteries; have vast armies and the largest navy in the world; own the 
greatest air fleet and the largest number of submarines ; let the farms and 
factories yield the greatest amount of output possible. If with all these 
things, which are supposed to make for prosperity, for safety and for hap- 
piness, the soul of the nation is dead, the nation will not long survive. What 
is the soul of a nation? The religion, the thought, the outward expression 
of an inner conviction, the thing for which a people will fight and die. 
What gives a nation a soul? Wisdom, unselfishness, thoughtfulness, good 
government, co-operation, protection, employment and sufficient wages or 
income to live a self-respecting life. 

The Task Ahead. 

Never was a nation called upon to play a larger part in the winning of 
a war than this country. We must finance our allies ; supply them food 
and wearing apparel ; build ships ; furnish arms and munitions ; furnish in- 
dustrial and military leaders as well as a large army of trained men, and 
throw our navy into the contest. In addition to all this we must mobilize 
our resources and keep regular lines of activity as uninterrupted as we 
possibly can. 

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Western Efficiency Society Conference 



The following- by Macfarlane in Collier's (March 10 and 17) will 
prove interesting: 

"Here is one fact in regard to the manufacture of rifles : four of the 
largest arms-producing factories in America took a contract in the spring 
of 1915 for approximately 5,000,000 rifles for the Entente Allies, to be deliv- 
ered within two years' time. That two years is almost up and but 15 per 
cent of the contract has been completed and shipped. Yet these factories 
had behind them adequate capital and the inexhaustible resources of 
America. 

"Bear in mind also the rough estimate that for every man on the firing 
line there must be five rifles in existence ; the one in his hand, the one in 
immediate reserve, the one back at the base, and one each in the hands of 
the two recruits that are in successive stages of training to take the fight- 
ing man's place when he is killed, disabled, or captured. 

"The British allotment of machine guns is 72 to each 2,000 men, while 
our allotment is but 6 ; and that in the face of the dreadful experience abroad 
which is perfectly well known to us all. And, by the way, the 240 Lewis 
machine guns which the army now possesses are due to no foresight of 
the War Department, but to the generosity of the British Government, 
which kindly 'lent' us that number out of a contract being filled for it in 
America." 

A stupendous and staggering load it seems, but one which can be 
worked out through ORGANIZATION ; through the proper adjustment 
and relationship of the human factor, which we are here to discuss. We 
have all the potential possibilities imaginable. All we have to do is to use 
them wisely, under expert direction. 

Coffin said that in war as in peace, there are now three graces — the 
Army, the Navy and Industry, and that the greatest of these is Industry. 
In other words, without industrial preparedness there can be no real mili- 
tary preparedness. If we do not have these things our part in the world 
conflagration will be both weak and ineffective. Coffin also said that we 
have learned that it takes from one to two years of time and conscientious 
effort to change any large manufacturing plant from its usual peace time 
commercial activity to the quantity producion of war material for which 
it has had no previous training; that while we have vast resources in manu- 
facturing and producing equipment, we are unorganized and uneducated for 
the national service. This spells but one thing— INDUSTRIAL REOR- 
GANIZATION. 

A state of war has existed for nearly two months, and while it is true 
that the matter of finances was taken care of promptly by Congress, it only 
recently settled the army problem, with an enormous amount of legislation 
to be put through. I do not want to be unduly critical, but I wonder some- 
times, if Congress really appreciates that this country is at war and with the 
strongest aggregation of military brains the world has ever seen, and that 
every minute is precious. 

Treasury officials do not conceal their concern over the slowness with 
which the "Liberty Loan" is being subscribed to. On May 15th, Secretary 
McAdoo said: 

20 



The Importance of the Human Factor in Industrial Preparedness 

"Failure to subscribe the $2,000,000,000 required would be a confession 
of national impotence. I do not for a moment doubt the overwhelming 
success of the Liberty Loan if the people are made to realize that no great 
work of this kind can be accomplished unless everyone throws himself into 
the task with the energy and fire of determined patriotism." 

Secretary Baker of the AVar Department, in a letter to Senator Jones on 
May 17th, made this statement: 

"Owing to a depleted state of our supplies it will not be practicable 
to call out the first 500,000 men to be raised under the provisions of the bill 
now pending before Congress, until about September 1st, so there will be 
no appreciable interference with the labor supply of the country until that 
date." 

Our experience on the Mexican Border should have pointed out the 
kind of lessons to the War Department that would have resulted in some 
better action with reference to equipment and supplies. 

Below are a few quotations from the inspection officers who served on 
the Mexican Border: 

"Only two days ago the quartermaster discovered 5,513 new wool blank- 
ets which he did not know he had. 

"Rifles and bayonets are in an awful condition — some of them com- 
pletely covered with rust, inside and out. 

"The regiment arrived at the mobilization camp without the articles 
required in the surplus kit bags. The men suffered from lack of under- 
clothing, as there was none on hand to issue to them. 

"The organizations were fairly provided with harnesses and wagons, 
but there were practically no horses or mules to draw the wagons. 

"Machine guns were lacking for many of the regiments. 

"It will be nothing short of murder to send these troops into any sort 
of active service." 

The Part Played by England. 

In the confusion and uncertainty that is a part of our present efforts 
to mobilize our resources efficiently and quickly, a glance across the water 
may give us new courage. 

Before the war, labor in England was better organized and was mofe 
powerful probably than in any other country. The unions absolutely lim- 
ited the production of labor at a point way below the average production 
per man in the United States ; they had forced about all the wage raises 
that the various industries could stand ; they had regulated the hours of 
labor, and controlled the employment of labor. With all these accomplish- 
ments the condition of labor was unsatisfactory to the trade unions them- 
selves, for Avages were low in comparison with prices, and there was lack 
of employment. Labor and capital were in continual warfare, though cao- 
ital was suffering without the power of retaliation against the powerful trade 
unions except through the raising of prices. The cost of manufacture due 
to low production was so high that English goods were unable to compete 
with foreign goods, sales were low and were falling off, and less and less 
men were being employed and more were emigrating to colonies. The 
statement was made to one of our engineers by several manufacturers whom 

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Western Efficiency Society Conference 



he visited in England that if conditions continued as they were they would 
be forced to discontinue in business. 

But war came, and what followed can best be expressed by William 
Hard in Metropolitan: 

"The trade unions of Great Britain stepped up to the altar of war and 
placed on it all their hard-won rules and rights and privileges, all their 
restrictions on output and on employment. What was the consequence? 
Immediately in thousands of factories all over Great Britain there was a 
revolution in methods of production. Instead of old awkward machines 
operated exclusively by union members, by skilled craftsmen, there came 
to be long rows of new improved machines operated not merely by skilled 
craftsmen, but by men semi-skilled and by men unskilled and by women." 

The result is that under the awful pressure of war, capital and labor in 
England are gradually reaching a new understanding. Necessity is, of 
course, forcing a solution of this important problem and the truce is more 
or less temporary, but English industry and English workers will never go 
back to the conditions which existed before the war — to the old order of 
things. Workers and employer must realize here that the fate of democ- 
racy depends upon whether or not they are willing to put their all, if neces- 
sary, at the feet of the war-god. 

The British solution of industrial troubles was not found in a moment. 
Lloyd-George, on December 2, 1915, told British workmen: 

"Either we must tell the soldiers that we are sorry that we cannot get 
the guns to enable them to win throughout 1916, owing to the trade-union 
regulations, or we must tell them that if they manage to hold out for an- 
other year perhaps American workmen will help us get a sufficient supply 
for 1917. I cannot return to Parliament and report through the House of 
Commons to the British Army that skilled workmen won't suspend their 
rules to save their fellow countrymen's lives on the battlefield." 

Some of the accomplishments of England since the war started show 
conclusively that a democracy when it really wakes up, can become unusu- 
ally efficient. A few of them, according to Mrs. Humphrey Ward, are as 
follows : 

Personnel of the navy increased from 140,000 to 400,000. 

Tonnage of the navy increased well over 1,000,000 tons. 

Eight million men moved across the seas — almost without mishap. 

Nine million tons of explosives carried to the British armies and those 
of her allies. 

Over a million horses and mules and fifty million gallons of petrol sup- 
plied to the armies. 

Twenty-five thousand ships examined for contraband of war. 

Further, the switching of productive equipment in England, from peace 
time pursuits to war time activities, proves also that a democracy can be 
resourceful, as is indicated by the following: 

A glazier made cartridge clips. 

A music roll plant made gauges. 

An infant food plant made plugs for shells. 

22 



The Importance of the Human Factor in Industrial Preparedness 

An advertising agency made shell adapters. 

Watchmakers adjusted fuses. 

A baking machinery plant made six-inch high explosive shells. 

A jewelry house made periscopes. 

A phonograph plant delicate shell parts. 

A cream separator factory made shell primers. 

A textile machinery firm made field kitchens. 

Edward N. Hurley recently said that there were more men in England 
today reading the books of American writers on the efficiency and manage- 
ment movement than in any other country. In his article "The War After 
the War," Isaac F. Marcossen, says in The Saturday Evening Post : 

"I have watched the inspiring spectacle of some of these factories, have 
walked through their forests of American-made automatics, heard the hum 
of American tools as they pounded and drilled and ground the instruments 
of death. What does it signify? This: that quantity output of shot and 
shell for war means quantity output of motors and many other products 
for peace. You may say that quantity is a matter of temperament and that 
the British nature cannot be adapted to it ; but speeded up, munitions mak- 
ing has proved the contrary. The British workman has learned to his 
profit that it pays to step lively. High war wages have accustomed him to 
luxuries he never enjoyed before, and he will not give them up. Unre- 
stricted output has come to stay. 

"Five years ago the efficiency expert was regarded in England as an 
intruder and a quack ; to use a stop watch on production was high crime 
and treason. Today there are thousands of students of business science and 
factory management. In the spinning districts girls in clogs sit alongside 
their foreman listening to lectures on how to save time and energy in work. 
Scores of old establishments are being reborn productively. There is the 
case of a famous chocolate works that before the war rebuffed an instructor 
in factory reorganization. Last year it saw the light, hired an American 
expert ; and today the output has been increased by twenty-five per cent." 

The Need for Organization. 

In an article published over a year ago, I said : 
. "We are a free people ; we have wonderful resources in money, men 
and materials ; we believe 'in union there is strength.' We are an unusually 
prosperous nation ; we are now contemplating preparedness. Will our peo- 
ple, believing as they do in unity, take these resources and prepare indus- 
trially as well as in a military way to lead the world, or will it take a great 
war to shake us free from individualism and force us, as it is forcing Eng- 
land, to learn the great lesson that the power behind the most efficient 
civilization is organization?" 

Well, we are in that war, and the power behind what we do is going 
to be the power of organization. Let me explain what I mean by organiza- 
tion. Everything that we do or say; everything that we use or make, is 
the product of the brain. In the last analysis the human being is at the bot- 
tom of everything. The coal, oil and iron would stay in the ground, the 
lumber would remain in the tree, and electricity in the air, if the human 

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Western Efeiciency Society Conference 



through initiative and knowledge, did not harness them to serve his ends. 

Organization, therefore, is the proper adjustment and relationship of 
human beings, in an effort to accomplish certain definite ends in life. If 
this adjustment and relationship is faulty, then we have an inefficient or- 
ganization, incapable of making a success of what is undertaken. If it is 
correct, logical and along sound lines, however, then success is bound to 
be the result. A few years ago I looked upon organization work as a cold- 
blooded adjustment of departments. Today I consider it as something 
wonderfully worth while — as the making over of humans — as MAN BUILD- 
ING. 

This conference could not have selected a more appropriate subject for 
discussion than this great subject of the human factor in preparedness. As 
James Logan, General Manager, United States Envelope Company, well 
says : 

"Hence I suggest that our immdiate problem is the problem of show- 
ing greater understanding of the human element in business when work- 
ing with our help. This has always been as difficult a problem as any in 
business; today for reasons which I have explained, I think it is the most 
important problem, barring none." 

The great question confronting us is how and in what manner? 

This question of the relation of the human element to the gigantic task 
,of preparedness, is so basic that it touches the problem at every angle, and 
in such a way that we cannot get away from it as it affects each and every 
one of us. 

With reference to industry, Frank A. Vanderlip puts it in this charac- 
teristic fashion : 

"How is labor to be had to make uniforms unless it is released from 
making other clothes ; how are looms to be had for blankets unless released 
from something else ; how is steel to be had for ships, tin cans and agricul- 
tural implements unless other consumption is curtailed ; how are women 
to be had for offices unless released elsewhere ; and finally, how are we to 
put $7,000,000,000 or $8,000,000,000 of purchasing power at the disposal of 
the government unless we curtail our individual expenditures? 

"The country should immediately awake to the fact that it has a great 
task in hand and that it cannot carry on a war like this with one hand and 
continue to do all the business it did before with the other." 

Take the matter of food as another example. The government is organ- 
izing a system of supplying labor for farms this summer, and in a short 
time expects to be enrolling hundreds of thousands of men, women and chil- 
dren for this work. State organizations will co-operate with the National 
organization. State boards appointed by the various governors will name 
county agents and they in turn will name community agents, who will as- 
certain farm needs and also register persons who can give all or part of their 
time to farm work. Surplus of labor or labor shortages will be matched 
and the labor departments will aid in effecting the proper distribution, the 
railroads to aid by g'iving low tansportation rates to laborers. 

Transportation is still another example of this matter of human ad- 

24 



The Importance of the Human Fa ctor in Industrial Preparedness 

justment. The war board of the American Railway Association issued the 
following notice to the roads on the night of May 17th: 

"Reduce the number of special trains and give up running excursion 
trains. 

"Consolidate where practicable through passenger train service and 
eliminate those trains which are not well patronized. 

"On branch lines where two trains are operated, try to reduce to one 
train a day. 

"Where practicable substitute mixed train service for separate passen- 
ger and freight service. Closely review number of scheduled freight trains 
where tonnage is insufficient to load them fully, with a view to reducing the 
number of trains. 

"Where passenger trains are double-headed for speed, a readjustment 
of schedules or cutting" off cars where possible, will release locomotives for 
freight service. 

"Reduce as far as practicable luxuries, such as observation cars ; in the 
interest of economy reduce the present rather elaborate and luxurious bills 
of fare on many dining cars. 

"Move 'company' freight on underloaded trains. Operate work trains 
as far as possible in slack times. Store coal in slack times. 

"Make proper train loading of primary importance with officials and 
train crews. Give publicity to those making good and poor records." 

Industry and the Worker. 

Before getting down to definite recommendations, let us give some con- 
sideration to the industrial side of things. 

Howard E. Coffin recently said : 

"Twentieth Century conflict demands that the blood of the soldier must 
be mingled with from three to five parts of the sweat of the man in the mills, 
mines and factories of the nation in arms." 

The attitude that the labor world of this great nation is likely to take 
in the critical period in our history, is therefore something worth consider- 
ing. I know of no better way of putting it before you than to quote from 
a recent letter to "The Independent" from Samuel Gompers, President of 
the American Federation of. Labor; Vice-President of the National Civic 
Federation and Chairman of the Committee on Labor of the Advisory Com- 
mission of the Council of National Defense, as follows : 

"In a word, good working conditions are as essential to high production 
as high production in this time of stress is essential to the maintenance of 
a battle-front. It would seem to be treason to the best interests of this 
country to desert such principles now. Now more than at any time in our 
national history we do not want production to fall off; rather, we want to 
accentuate it. Now more than ever we want the army in the factories and 
fields to be an army of strength fighting for democracy ; we don't want a 
nation of working people with hearts and bodies weakened. We need, 
rather to strengthen our men and women for the war and for the recon- 
struction after the war. 

"The supreme thought that I have in cooperating and in asking the 

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Western Efficiency Society Conference 



cooperation of the men of labor in America is to demonstrate that democ- 
racy does not spell inefficiency, but, on the contrary, to demonstrate that 
the demcracy of America can show to the whole world that in war as in 
peace it is united for any emergency/' 

The following gem from a worker, who is also a socialist, will prove 
encouraging to the student of preparedness: 

"I firmly believe, unless the spirit of hostility can be replaced by the 
spirit of cooperation — we are in for some sorry times. I also believe it 
behooves every individual and every organization who cares for their coun- 
try and their fellowmen, to use every effort to avoid any conflict whatever. 
We cannot expect to climb the hill to sun-crowned heights with industrial 
strife on our backs." 

A sublime spectacle was staged in Washington May 15th, when men 
whose fortunes represented many millions of dollars, met with the Com- 
mittee on Labor of the Advisory Commission of the Council of National 
Defense, to work with Samuel Gompers in an effort to bring about full co- 
operation between the government, capital and labor, for the efficient prose- 
cution of this war. 

The following extracts of speeches at this conference, are worthy of 
mention and consideration : 

Mr. John D. Rockefeller, Jr. : "It is a great pleasure to know the labor 
people. I would like them to know me as their friend. I sometimes regret 
that the opportunity did not come to me to make my way in this world with 
my hands as my father did. But circumstances made it necessary for me 
to go a certain way, and I have done what I felt best. I honor and respect 
men who have made their way with their hands, and I covet that oppor- 
tunity for my sons, for I consider those who work with their hands as hon- 
orable and often more honorable than those who work only with their heads." 

Mr. Daniel Guggenheim: "Yes; it is a revelation, and it has inspired 
me. I have felt for some years that my work was nearing its end ; that 
I might be allowed to take things a little easier. You see, I have worked 
for forty-five years, and I was thinking of turning over my work to my two 
sons and to my son-in-law. But recently I arranged things so that they 
could all go to the front when the call came, and I could go back into the 
harness and do the work which they were going to do for me. When the 
call came from Mr. Gompers perhaps I felt that I had enough on my shoul- 
ders. But I came here, and I want to say that I am prepared to do any- 
thing I can do — just as long as I am able to carry it out." 

Mr. Theodore Marburg of Baltimore : "It is a fight for justice we are 
engaged in, and it depends upon what can be accomplished by groups like 
this whether it will end in a reasonable time. I am sure what the end will 
be. You may have injustice triumph for a time, but it is impossible that 
the wrongs which have been recognized by all the world should triumph in 
the end. My fear is that the same apathy which characterized England at 
the beginning of the war is going to characterize our attitude. I fear a full 
year may pass before we are aroused. One duty before us is to rouse the 
people." 

26 



The Importance of the Human Factor in Industrial Preparedness 



You have heard from the engineer, the labor leader, the worker and 
representatives of capital, all of which show that there is unmistakably a 
willingness to get together? The question is— what are some of the fac- 
tors which must be considered? 

In a constructive program of preparedness that will give this country 
adequate defense both in time of war and in time of peace, and in order 
that this nation may be born again, we must have four things : 

1. There must be greater efficiency in government, with reference to 
its relation to industry and to labor. 

2. The workers must become more efficient. 

3. The employers must adopt all methods that make for the reduction 
of waste. 

4. Worker and employer must co-operate more in the future than they 
have in the past. 

The absorbing question is How? 

I have never liked the terms "Scientific Management" and "Efficiency 
Engineering" and I am going to propose for your consideration the term 
"Co-operative Management," which would be everything that the name im- 
plies ; a plan of management in which co-operation between worker and em- 
ployer would be the basic consideration. 

Imagine what would happen if a body of workmen should go to their 
employers and say : 

"We have made a careful study of this new science of management. 
We want to assist in bettering working conditions; we want to help you to 
reduce your costs so you can increase your sales, knowing that in so doing 
we can increase our earnings and you your dividends. What do you want 
us to do?" 

It would not be long before there would be a relationship between cap- 
ital and labor that would mean low costs, high earnings, the best kind of 
wages, shorter hours, and a spirit that would make for permanent better- 
ment. 

I sometimes wonder why it is that those among the labor leaders who 
have vision, who are actuated by high ideals and excellent motives, and 
there are many of these, have not come forward and urged their following 
to take an active part in this important work, to the extent of employing 
counsel on management, showing; their employers where waste exists, for 
more often than you have any idea of; the workmen know where to put 
their fingers on losses. It seems to me that the next era in management 
will see both sides, shoulder to shoulder devising and installing betterments, 
and if this will be one of the by-products of this war, it will not be without 
its compensations. 

Would it not be better for the employer and the worker to get together 
and with the help of outside counsel, effect the kind of a compromise that 
would enable both to work in harmony rather than in discord? Would it 
not be better for each to give up, for the time at least, some of their aims if 
necessary, and working as one, make consistent gains towards better condi- 

27 



Western Efficiency Society Conference 



tions, rather than fight for 100% of the things they want but which they 
will probably never get? 

Some of the problems needing our immediate attention are: 

1. How to keep needed workmen from enlisting or being drafted. 

2. Strikes. 

3. Sickness and accidents. 

4. Fatigue. 

5. The stop watch. 

6. More producers and more production. 

7. Women's Place. 

8. Education. 

9. Prohibition. 

Enlisting Workmen. 

I was informed in Washington that the plan with reference to the se- 
lective draft, is to give a manufacturer ten days after one of his men is 
called, in which to enter a protest against taking him, with reasons why he 
should be left at home. 

As the full strength of the National Guard, however, will be drafted 
into the U. S. Service, July 15th to August 5th, it will mean that a minimum 
of 329,000 men will be added to the 293,000 regulars who will be under arms 
by June 15th. Most of these men have been and will be secured under the 
volunteer system and it stands to reason that unless steps are taken to enlist 
the help of the government in keeping the men critically needed at the bench 
and the machine, industry is going to be severely influenced by this volun- 
teering. 

For instance, it is estimated that there are only about 3,000 really expert 
gauge workers in the country and nearly everyone appreciates how seriously 
we are in need of gauges and dies with which to make arms and ammuni- 
tion. What a pity it would be under the circumstances, if many of these 
gauge makers would enlist, forcing industry to train new men on this com- 
plicated work. 

Strikes. 

There should be no strikes at a time like this and ways will have to be 
found to settle honest differences before a strike occurs. Should one take 
place, the only thing left is for the government to step in and take over the 
plant, as it did the plant of the Brown Shoe Company, Moberly, Mo., last 
week. The plant had been closed for four months due to a strike and all 
efforts to reopen the factory had failed. Tire plant will now be run under 
government supervision and will manufacture tents, leggings and other war 
materials. There will be no strikes if the following- letter which should be 
distributed to workmen in this country, is considered. It is from an English 
soldier who for fourteen years had been a faithful worker in a pottery fac- 
tory, then was drafted to the colors and sent to the trenches in France: 

"Jack, it breaks my heart to see in the papers that you and your com- 
rades are now wasting time to scrap about wages, hours and such child- 
play. I didn't blame you before the war. 1 was then a labor union man 
myself. T will not blame you for doing - so after the war. Tf T live we'll then 

28 



The Importance of the Human Factor in Industrial Preparedness 



be union men together. But for God's sake, Jack, forget such things now. 
Remember that we fellows are suffering, starving and dying over here, 
largely for want of more ships. 

"Why, Jack, if I could only change places with you, I would work all 
day and all night, and be happy to live on bread and water. Jack, the very 
worst conditions which you ever saw are Heaven to what us boys over here 
are going through. What's money or hours or anything else compared with 
getting ships built to save us from Hell. I say, Jack, for God's sake do more 
for us ! 

"I hear you don't believe in war, Jack. Well, I guess none of us fel- 
lows like war much better than you do. But let me tell you that the only 
way to make this the last war is to give us your very best now. Please, 
please help us. And say, Jack, please post this letter where the other boys 
will see it. Can't write any more. I'm too weak. Goodbye." 

Sickness and Accidents. 

The following statistics will prove interesting in connection with our 
consideration of industrial matters. 

35,000 workers are killed in industry yearly. 

700,000 workers are injured yearly. 

Each one of our 30,000,000 workers loses on an average of 9 days a 
year through sickness causing them a monetary loss of $700,000,000. In 
other words, there is a loss in productive effort in the things which could be 
built each day of 270,000,000 days a year. 

Frederick W. Loghran in the Times Magazine says : 

"It is a generally accepted principle of modern sanitary science that a 
large amount of sickness, in industry and otherwise, is preventable and that 
the. average duration of life can be materially prolonged by deliberate and 
rational methods of personal, social and industrial hygiene. It is safe to 
assume that at least 25% of the sickness among workers can be prevented, 
thus diminishing present losses by about 67,500,000 days a year, resulting in 
a saving to workmen of $168,750,000 plus the gain in productivity of $337,- 
500,000, making a total economic gain to the nation of $506,250,000. 

In our consideration of the human factor in preparedness, we must not 
lose sight of the part that "fatigue'' will play in the scheme of things. Those 
of us in the Industrial Engineering field have repeatedly called attention to 
the effect of exertion and fatigue on the worker and while some attention 
has been given to the matter, it has not been all we desired. If the physical 
condition of a worker is worth consideration in peace times, it is certainly of 
fundamental importance in war times, when under the natural stimulation 
due to the call to amis, men and women will go to the limit, if not beyond 
their physical endurance. 

Roughly figuring it takes three to five men in industrial pursuits to 
maintain one soldier on the firing line. You can, therefore, fully appreciate 
what it will mean to maintain an army of from one to two million men. The 
drain on industry will be enormous, and to make good, part of this loss from 
the industrial fields, woman and in some cases child labor, will have to be 
utilized, in fact, I believe I am safe in predicting that the next six months 

29 



Western Efficiency Society Conference 



will see utilization of woman and child labor on an enormous scale, which, 
of course, makes the question of fatigue and physical welfare, all the more 
important. 

England has done a wonderful piece of work along these lines. The 
subject has received scientific attention, with the government behind it. 
Three different investigations were conducted — by the Home Office, the 
British Association and the War Office, and the Committee on the Health 
of Munition Workers, with Sir John Newman as its chairman. It was 
found that night work, Sunday and overtime work caused an increase in 
sickness and absence on the part of man as well as woman labor. In one 
case of a works employing 36,000 hands, the percentage of sickness increased 
from 2.9% to 4%. In two departments the rate among men on overtime 
was 5.5 % as against 3.7% for those on double shift. In addition it was 
found in case of one thousand of the men that the rate was as high as 8%, 
due to the greater age of the workers, a fifteen hour day, Sunday work and 
the natural strain of wartime production, which was enervating after a time. 

Trained investigators studied output in a careful manner. One of the 
experts, Prof. Stanley Kent, found that considered in groups, employees 
lost from 18 to 27% in time because of fatigue caused by continuous over- 
time and lack of a weekly day of rest. Another expert, H. M. Vernon, stated 
that women workers, engaged in moderately heavy labor, increased their 
output 8% when hours were reduced from sixty-eight to fifty-nine per week. 

In the confusion that will be contingent on a rapid mobilization of in- 
dustrial workers, whether men, women or children, do not let us overlook 
the question of hours, rest periods, both daily and weekly, and the effect of 
night work, Sunday work and overtime. 

As you well know, an enormous responsibility rests upon the shoulders 
of the workers. Let us do our share in securing for them, the kind of con- 
ditions that will maintain their physical fitness and at the same time insure 
a maximum production of the proper quality. 

The Stop Watch. 

Speaking of the stop watch in management, about which there has been 
so much discussion and discord, Miner Chipman, in his investigation for 
the workers at the Watertown Arsenal, on conditions under the Taylor Sys- 
tem, in operation there, says : 

"After a careful study of over two hundred statements, written by as 
many men employed by the government and working under the system at 
Watertown Arsenal, I found the fundamental ground for complaint was not 
time-study or premium. Throughout these statements it was made clear 
that the objection to these devices of scientific management were based upon 
the method of introduction and administration and not upon he devices 
themselves." 

If there is merit in the stop watch and time-study; if it is needed in any 
constructive plan of co-operation or scientific or efficiency management, then 
let us go at the problem, not by trying to force the' use of this mechanism 
as a device of management, but by getting both sides together on the method 
of introduction and administration. 

30 



The Importance of the Human Factor in Industrial Preparedness 

More Producers and More Production. 

Two conclusions are forced upon me as I study the subject of human 
relationship : 

1, There must be more producers. 

2. There must be a greater amount supplied by those who now produce. 
The first can only be brought about by giving labor shorter hours, better 

working conditions and rewards which will attract workers. The second is 
possible by eliminating waste, standardizing conditions and operations, 
proper planning and enabling men to earn that which represents to them 
their skill and co-operation. 

Woman's Place. 

In this adjustment of the human factor, the load that is going to be 
thrown on the shoulders of our women, will at first glance seem to be too 
much for what has been termed "the weaker" sex, a fallacy by the way, that 
this war has knocked into several kinds of a cocked hat. She is standing- 
shoulder to shoulder with the man, doing her bit just as nobly, just as will- 
ingly, with, in fact, a greater degree of self-sacrifice, with the result that the 
old gag, "the women — God bless them," is really standing for something be- 
fore the whole world today. In England the war has been a great equal- 
izer of the sexes. It will prove so here. 

In this connection, the following thought, by Maud Wetmore, Chair- 
man of The National League for Woman's Service, is worthy the careful 
consideration of men and women alike: 

"The responsibility for improving our national life and fulfilling our 
national ideals should be evenly divided between men and women. And 
just as men must discipline themselves and prepare to carry their full share, 
so must women. Women must realize the interdependence of the individ- 
uals that comprise the nation ; they must learn to think nationally, and in 
this period of stress they must recognize that they can afford to give noth- 
ing less than their best. Where women are needed to supplement the forces 
of men in the industries, those who are fitted or experienced must come 
forward and their home interests must be looked after by others. Our 
women must do everything possible to enable their men to give full service. 
In Detroit, for example, the league is encouraging its members to learn their 
husbands' business, so that when the man is called to take his place in what- 
ever line of defense he is needed in, the wife may be able to maintain the 
family's economic status. Upon women rests the responsibility for main- 
taining the home standards." 

Education. 

According to Richmond P. Hobson, an analysis of the antecedents of 
10,000 leaders in all the walks of American life, as compiled in "Who's Who 
in America," shows that the boy who stops school with the grammar school 
has only one chance in 9,000 in becoming a leader; the boy who completes 
high school has one chance in 400, while the boy who goes through college 
has one chance in forty. 

The average American boy leaves school before his twelfth year. In 

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Western Efficiency Society Conference 



Germany every boy is required to go to school until he completes his six- 
teenth year, and he generally continues vocational night classes after that. 

Prohibition. 

The question of whether or not there should be complete prohibition is 
worthy of our consideration, as men who have had an opportunity to study 
working conditions at close range. Personally, I am in favor of cutting out 
whisky and the heavy and enervating drinks. With reference to beer, how- 
ever, let me give you the opinion of Kennedy Jones, an English director of 
food economy, as follows : 

"Whether the brewing of beer shaH be stopped at once and the barley 
already malted used for mixing with flour is a question of policy and hinges 
on the point whether the malt in bread or in beer will secure the most effi- 
cient prosecution of the war. Unlike America, beer has been for centuries 
a part of th daily diet of our working classes. A great number of men en- 
gaged in very heavy manual labor — as for example, men working at blast 
furnaces — must drink considerable malt liquor. This is not only a prac- 
ticable fact; it is a scientific fact. The bulk of these men are in the habit 
of taking that liquid in the form of beer. The question is not whether cold 
tea would be better for them, but what would be the effect on the output of 
work by suddenly cutting off thir supply of beer. 

"If it be found advisable to stop beer altogether — upon which point 
there is a considerable difference of opinion — it would be simple common 
sense to allow the workers time to adapt themselves to the change gradu- 
ally, by a gradual reduction of the supply, rather than by checking or stop- 
ping the brewing of beer at once. Also it is well to bear in mind that if 
the worker is not deriving part of his energy, as has been his habit, from 
his beer, he may require more bread, so that practically no actual saving 
of bread could be effected. 

"Moreover, we may well take a leaf out of Germany's book in this mat- 
ter. That country — which again is unlike the United States in that beer is 
part of its normal diet is in the matter of food now scientifically organ- 
ized with a view to supplying its workers with a maximum of energy for 
the prosecution of the war. South Germany is still brewing 35% of its pre- 
war quantity of beer against our 27y 2 per cent, no one would suggest that 
the food situation in Germany has not been serious for the last twelve 
months." 

The Engineer in planning to meet the labor requirements necessary for 
the enormous production required on account of the war, should be careful 
that in his plans he does not impose sacrifices on the part of labor such as 
ionger hours or less pay, for while workers may be willing to sacrifice their 
last drop of blood for their country, they desire to lay their sacrifices them- 
selves on the altar of patriotism and not to have them offered up by others. 
Labor, Capital and Engineers, will find that the co-operation between them 
and the unity of purpose so necessary to successfully conducting the war, 
will only be accomplished if each makes it a point to show the greatest 
consideration to both the others in their dealings with them. 

We do not need the greatest army or the greatest navy in the world, 

32 



The Importance of the Human Factor in Industrial Preparedness 



! at we do need the greatest efficiency and the greatest contentment on the 
part of our people. Contentment and lazy living without efficiency would 
only lead to our own undoing. Efficiency without contentment, would in 
time, make us a race of human machines. We do not want them separately 
—they must be, harnessed together. 

Industry and the Government. 

At this point it may be interesting to consider the relation between the 
government, industry and the people. Let us first take up the mechanism 
so far created to assist in co-ordinating these three factors. 

The Council of National Defense was created in an Act approved on 
August 29, 1916. The Council consists of the Secretaries of War, Navy, 
Interior, Agriculture and Commerce and Labor. The purpose for which 
the Council was created is stated in the Act as "The co-ordination of indus- 
tries and resources for the national security and welfare. To advise the 
Council in carrying out of those duties the law provides that the President 
appoint an advisory commission, consisting of not more than seven persons, 
each of whom shall have special knowledge of some industry, public utility, 
or the development of some natural resource, or be otherwise specially qual- 
ified in the opinion of the Council for the performance of its duties. 

The duty of the Council is to supervise and direct investigations and 
make recommendations to the President and heads of executive departments 
as to the location of railroads with reference to the frontier of the United 
States, so as to render possible expeditions, concentration of troops and 
supplies to points of defense ; the co-ordination of military, industrial, and 
commercial purposes in the location of extensive highways and branch lines 
of railroad; the utilization of waterways; the mobilization of military and 
naval resources for defense; the increase of domestic production of articles 
and materials esse'ntial to the support of armies and of the people during the 
interruption of foreign commerce ; the development of seagoing transporta- 
tion; data as to amounts, location, method and means of production, and 
availability of military supplies ; the giving of information to producers and 
manufacturers as to the class of supplies needed by the military and other 
services of the Government, the requirements relating thereto, and the crea- 
tion of relations which will render possible in time of need the immediate 
concentration and utilization of the resources of the nation. 

The seven Advisory Commissioners appointed by the President are as 
follows: Daniel Willard, president of the B. & O. Railroad, chairman; 
Howard E. Coffin, vice-president Hudson Motor Car Company; Dr. Hollis 
Godfrey, president Drexel Institute, Philadelphia, Pa. ; Samuel Gompers, 
president American Federation of Labor; Julius Rosenwald, president Sears 
Roebuck & Co.; Dr. Franklin H. Martin, of Chicago; Bernard M. Baruch, of 
New York City. 

To handle their affairs, the Advisory Commission already has formed 
seven subcommittees with their chairman as follows : 

First: Transportation and Communication, Mr. Willard, chairman. 

Second : Munitions, Manufacturing, including Standardization and In- 
dustrial Relations, Mr. Coffin, chairman. 

33 



Western Efficiency Society Conference 



Third: Supplies, including food, clothing, etc., Mr. Rosenwald, chair- 
man. 

Fourth: Raw Materials, Minerals and Metals, Mr. Baruch, chairman. 

Fifth : Labor, including conservation of health and welfare of workers, 
Mr. Gompers, chairman. 

Sixth : Medicine, including general sanitation. Dr. Martin, chairman. 

Seventh : Science and Research, including engineering and education, 
Dr. Godfrey, chairman. 

Under date of May 9th, C. W. Gilbert said in the New York Tribune: 

"But the realization that the country is not organized to accomplish 
results is coming home to many minds. Members of the government just 
below Cabinet rank openly talk of the need of a better organization. And 
men in the Council of National Defense familiar with the methods of the 
business world look with dismay on a vast mechanism that centers nowhere. 

"That is what is the matter. There is an organization for making war, 
or for making ready for war, a vast organization that is growing daily with 
the creation of boards, but is an organization that cannot get things done. 
There is no direction given to its efforts. It is an organization without an 
effective head. It has many energetic members, but thy have no definite 
and certain relation to each other. There are a variety of activities, many 
of them interesting and impressive, but they run along parallel lines and 
don't come together in any common center. The government hasn't a pro- 
gram intelligently framed and executed from above, but it has a lot of parts 
of a program being pushed upward from below." 

These facts were confirmed by another paper whose editor I called up 
and talked the matter over with. 

In speaking of the work of the Council, Richmond P. Hobson said: 

"But what a pity the council was shorn of its fundamental nature by 
eliminating the legislative branch of the government." 

Peter Clark Macf arlane in Collier's, March 10th, commented as follows : 

"The greatest difficulty that I see ahead for industrial mobilization is 
the inevitable conflict between private energy and enterprise and the dull 
inertia of the bureaucracies at Washington. All these committees now have 
a certain official sanction, which means merely that the department heads 
are bound to listen to their suggestions, but not to follow them. The real 
danger is that the splendid work of American business genius may be half 
defeated through sheer official or congressional stupidity. 

"It is one thing to get advice of experts and another to be guided by it. 
At the present writing some of the leading electrical engineers of the country 
are warning the Navy Department against putting an electric drive into its 
new $19,000,000 battle cruisers ; and so far the department has stubbornly 
refused to let the matter be reopened for even a brief congressional investi- 
gation. Undoubtedly the departments and Congress have to be educated 
as well as the manufacturers and the people. 

One of the real needs of the moment is ably summed up by Prof. Albert 
Bushnell Hart of Harvard University, as follows : 

"Go further, please, Mr. President. We demand for the post of Secre- 

34 



The Importance of the Human Factor in Industrial Preparedness 

tary of War, the best, strongest, ablest man for that place that you can 
find within the forty-eight states, two territories, and numerous dependen- 
cies. Why don't you take a military man for this technical, complicated, 
military job? Why must a lawyer-mayor, however breezy, be the channel 
through which your directions as Commander in Chief of the American 
Army flow to the soldiers? Why don't you appoint the best, ablest, widest 
awake general in the army? The Secretaryship of War was not too good 
for General Grant. 

"Could you not go outside your party, if necessary, in this time of 
stress and danger, as Linco'ln did when he appointed the Democrat, Stanton, 
who had been very uncomplimentary to his President? Or could you not 
find some captain of industry accustomed to direct thousands of men, 
through trained department heads, who are full of enthusiasm for him, and 
still more for their work? 

"So in the Navy Department. Please, Mr. President, give to your af- 
flicted country the very best naval man in the United States, the most effi- 
cient, wide-awake, and positive Admiral, in service or retired, or a big 
steamship man, or at least a great lawyer accustomed to affairs on the larg- 
est scale. AVe have no quarrel with Secretary Daniels, or with any man 
who tries to do his duty; but the job is too big for any man of Mr. Daniels' 
previous training and experience. The ability of the Secretary of the Navy 
to command the confidence of the naval service and of the American people 
may make all the difference between a glorious victory and a crushing de- 
feat. We have no margin to spare for educating Secretaries of the Navy. 
When you were President of Princeton University you did not appoint a 
journalist to be Professor of Engineering, or a chemist to be Professor of 
Political Science. Please, carry the same principle to the navy. 

"And, oh, please, Mr. President, do use the experts of the country, the 
engineers and chemists, and transportation men, the bankers and manufac- 
turers, the college professors, the school teachers, use everybody that can 
do anything to support the nation ! Germany has done many bad deeds, 
but has taught the world that in this modern civilization it behooves every 
man, woman, and child to do his or her part for the common country. If 
we can learn that lesson of real, practical, serviceable love for country, then 
the United States will endure. Please, Mr. President, you have been a 
school teacher, teach us that lesson. And don't lose any time in prelim- 
inaries. The Scriptures say, 'Now is the accepted time — now is the day of 
salvation.' " 

What we have got to do and quickly, is to so centralize power around 
our Chief Executive, as to demonstrate to the world, as England is so nobly 
doing, that democracy can be as efficient as autocracy. We must make our 
President see the necessity for a few strong, experienced and able men car- 
rying the load with him. If we can do that, and it will have to come, there 
will be no more need for autocracy in the world, and it will die a natural 
death. The answer, however, is in a strong central co-ordination and con- 
trol. 

Roger W. Babson said recently : 

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Western Efficiency Society Conference 



"The fact is that there is a great waking up in industry. Employers 
are realizing that new ideas and radical changes are inevitable and they are 
turning to anybody who can show them the way to go. This is one of the 
most hopeful signs of the times. Really competent industrial service is 
now available and employers are taking advantage of it in increasing num- 
bers." 

The same kind of service that has been and is being rendered industry 
is applicable to government activities and it is to be hoped that the organiz- 
ing engineers of the country will be able to exert a greater influence over its 
affairs. 

In government affairs we must consider and recognize all the various 
phases of government work the same as a department is recognized in in- 
dustry. In doing this consideration should be given to the following: 

1. The chief interests should be represented. 

2. A permanent manager of experience and ability, with sufficient sal- 
ary to warrant continued service. 

3. Work taken out of politics, with red tape eliminated. 

4. A staff of experts assisting. 

5. Supervision to see that the standards and provisions outlined are 
lived up to and progress made. 

6. Legislation to be initiated by those departments and submitted for 
analysis or rejection. 

England and Germany have both increased materially the efficiency of 
their war machine through the use of experts. To the New York Times, I 
am indebted for a brief analysis of the elaborate German organization, which 
should prove of interest to you, as follows : 

"Under this law which is known to the English speaking people as the 
'civil mobilization law,' there was set up in Berlin a new kind of war office. 
A soldier (and please mark this) was placed at the head of this new war 
office, but he was selected because of distinct achievement in the field of 
economic and executive effort rather than because of honors won in the 
command of armies. This man was Lieut. Gen. Groener, who had ren- 
dered conspicuous service in the organization of the War Food Office, of 
which Dr. Batocki was the head. Having organized the food control sys- 
tem, General Groener was set to work to organize the labor and industrial 
resources of the nation, so that the maximum of munitions and war supplies 
might be produced at the same time that all the regular channels of industry 
and trade went on as nearly uninterrupted as might be." 

This organization is spoken of as a two-sided organization, one being 
intimately connected with the military staff and other considerably more 
remotely. The article further says : 

"It is on the war side showing the military staff that the most interest- 
ing glimpse of General Groener's organization is shown. This is the sec- 
tion labelled 'Chief of the Technical Staff,' which is tied to the office of 
General Groener himself, and at the same time to that of the chief of the 
military staff. The head of this technical staff is Dr. Sorge, who for years 
was at the head of the great Gruson works in Madgeburg, which are now a 

36 



The Importance of the Human Factor in Industrial Prei 



AREDNESS 



part of the Krupp concern. Dr. Sorge is one of the great captains of indus- 
try of Germany. His acceptance of the post of chief of the technical staff 
is very much as if the head of the Steel Corporation, or the Harvester Com- 
pany, or the General Electric concern should take a similar post under our 
government." 

In our own crisis cannot you see Major Goethals, the builder of the Pan- 
nama Canal, the soldier-executive, as Secretary of War; a man like Charles 
M. Schwab as head of a technical division, and Theodore Roosevelt as Sec- 
retary of the Navy? 

There is still another thought worthy of mention in connection. The 
time will come when this war will be over ; the entire world will rush head- 
long into peaceful pursuits, and a mobilization of trade armies will then 
take place. 

Whether or not we muddle through, we are going to end up by being 
industrially prepared for war and we will have an efficient mechanism for 
carrying on the work. The point is this : Will we plan now, to make this 
mechanism permanent, or will we let it rust and fall apart after the war? 
From the standpoint of good organization, it would be wise to make every- 
thing- we do at this time count for something with reference to the future. 

We must be careful also that in our zeal to get the best kind of men for 
the national service, we do not impose unwise restrictions. The following 
editorial from the New York Herald illustrates what I mean : 

If Eventually — Why Not Now? 

"My son, aged twenty-four, unmarried, was graduated as an aviator 
from the Curtis School in Hammondsport, in July, 1914. He offered his 
services to our government just about a month ago. He cannot be accepted 
because he has not a college education." — "A Mother," in the Tribune. 

Great Britain had such a ruling at first but promptly abandoned it as a 
hampering requirement. In others words, we must get out of clouds into a 
realm of the practical. 

The Real Trouble. 

The inefficiency met with in industry and in government is not so much 
that of the workers as that of the managements and executives who are 
responsible for directing the actuaries of subordinates. As Gantt well said in 
an article on "What Is Preparedness?" 

"Without efficiency in management, efficiency of the workmen is use- 
less, even if it is possible to get it. With an efficient management there is 
but little difficulty in training the workmen to be efficient. I have proved 
this so many times and so clearly that there can be absolutely no doubt 
about it. Our most serious trouble is incompetency in high places. As lone 
as that remains uncorrected, no amount of efficiency in the workmen will 
avail very much." 

The Efficiency Society of New York made an analysis some years ago, of 
the organizations of thirty-five plants, one of the conclusions being: 

"Such being' the case, and taking into account as a normal condition that 
the flow of influence in an organization is from the top down, it would seem 
evident that increased efficiency will be soonest secured by applying effi- 

37 



Western Efficiency Society Conference 



ciency principles initially to the personal operations of the managers, rather' 
than to those of the workers, as has so often been done." 

The Need of the Hour. 

There has never been a time in our history when real statesmanship and 
efficient leadership was as necessary as in this crisis. Our real need is best 
expressed by the definition by Fenelon, of the real statesman, which ap- 
plies equally well to the real executive whether in business or in politics, as 
follows : * 

"The real statesman while doing- nothing himself, causes everything to 
be done ; he contrives ; he invents ; he foresees the future ; he reflects upon 
what is past ; he distributes and proportions things ; he makes early prep- 
arations ; he incessantly arms himself to struggle against fortune as a swim- 
mer against a rapid stream of water; he leaves nothing to chance." 

Isaac F. Marcossen asked Lord Northcliffe why he fought so hard for a 
sma'll cabinet to carry on the war. He asked Marcossen : 

"Could twenty-three Lincolns run your government during the Civil 
War? Could twenty-three Grants win it?" 

"No," replied Marcossen. 

"Well," snapped Northcliffe, "there's your answer." 

In this important matter of the adjustment, and relationship of the 
humans making up our complex industrial fabric, certain essentials, which 
have been developed after a long experience in business, are worthy serious 
consideration. Men and women from all wa'lks of life are going to be mus- 
tered into the national service. This will make up one class of humans 
which will have to be trained. The other will be that composed of those 
who take the place of the ones who are on the firms: lines or supnorting 
them back home. To both classes the following will be found aoplicable : 

We have found that the man with the highest type of initiative is the 
one who sees things to be done without beine informed and who then dele- 
gates to others the task of doing the work. The man with the next highest 
type is the one who sees things to be done without being informed and who 
does the work himself. The next in order is the one which sees things to 
be done after being informed but who does the work without being told. We 
need not mention the fourth or fifth classes. 

In other words you can measure a man's power in business by the ex- 
tent to which he induces efficiency in others, with the least attention on his 
own part to the duties to anyone but his own. That this is a good business 
law is evident if you will consider that there is a limit to the amount of 
detail that a man can handle, but practically no limit to the amount of super- 
vision that he can exercise, because he is then guiding others. Could Lloyd- 
George in England or Von Hindenburg in Germany be the powers they are 
in their countries, if they attempted to supervise and handle details at the 
same time? 

It is, of course, true that a strong, powerful personality desires to do 
things himself, as he feels that he can do them better than another, and in 
a sense he mav be right and there is no harm done, if he does not attempt 
too much. If he does, however, he not only limits himself in that he cannot 

38 



The Importance of the Human Factor in Industrial Preparedness 

plan and scheme and do at the same time, but he failing to develop initiative 
in those about him and in time develops a force of "leaners." 

I believe that we will all agree that no man knows what he can do until 
he has had a chance to demonstrate what is in him, nor is there a man who 
is not able to do more things than he believes himself capable of. We have 
time and again found a man of only average ability as a "leaner" developing 
unusual ability when given definite responsibility, with the necessary au- 
thority to get results or make way for someone who could. 

Executives are sometimes prone to fall into the error of meddling with 
subordinates, to the extent of determining the manner in which details 
should be handled. The important consideration is to ge the thing done — 
get the message to Garcia. If I send a man to New York, I do not care 
when he goes or how he goes, as long as he gets there at the appointed time. 
It's results which count — not excuses. 

An officer reported to General Kitchener at one time that he had been 
unable to carry out an assigned task and gave his reason why. He replied : 

"Your reasons for not doing it are the best I ever heard. Now go ahead 
and do it." 

Imagine what happens to the imagination and originality of a man who 
has a brain of his own to constantly see things through the eyes of another, 
who in time accepts one conclusion after another, without giving the matter 
any particular thought. He becomes a machine, which is not fair to him, 
with the danger of at sometimes doing a wrong thing because he has quit 
doing his own thinking. 

Our experience shows that the real function of an executive or depart- 
ment head are : 

1. To exercise general supervision over the business of department: 

2. To critically analyze results. 

3. To put new problems before his men for their consideration, advice 
and action. 

4. To criticize subordinates when results are not forthcoming, setting 
forth the reasons why. 

5. To see that prescribed practice is lived up to. 

In "The Pharoah and the Priest," by Glovatski, are these words of the 
priest to Pharoah, which is the best description of efficient adjustment and 
relationship that I have seen : 

"Draw on the earth, O lord, a square, and put on it six million unhewn 
stones ; they will represent the people. On that foundation place sixty 
thousand hewn stones ; they will be the lower officials. On these put sixty 
covered with carvings ; these will be thy most intimate counselors and chief 
leaders, and on the summit place one monolith with its pedestal and the 
golden image of the sun ; that will be thyself." 

The Engineer in Preparedness. 

Everyone wants to help and the government and the Council of De- 
fense have been literally deluged with letters and telegrams from people 
offering their services, plants and products ; from societies placing their 
membership at the disposal of the government and from organizations with 

39 



Western Efficiency Society Conference 



plans for the solution of this or that problem. The government does not 
know what to tell these people/societies and organizations to do, nor will it 
be able to, until it has a more comprehensive plan than exists at present. 

As Gilbert well said in the Tribune: 

"The government hasn't a program intelligently framed and executed 
from above, but it has a lot of parts of a program being pushed upward from 
below." 

Do not depend upon Congress to save the country or prepare it for 
proper defense. The lawyers and the politicians have no place in shaping 
our industrial foundation. Who then? 

F. W. Loghran in the Times Magazine says : 

"The aggressive employer is asking himself what elements can I bring 
into my business that will increase the output, reduce the cost of produc- 
tion, and at the same time raise the wages and earning capacity of my em- 
ployes? In these days of great industrial stress it is necessary that this 
question be answered." 

It seems to me that there is no one better fitted to answer this question 
than the engineer. 

A man who had spent a year in the service of the Belgium Relief Com- 
mission said to Mr. Coffin : 

"Do you realize that within ten years the engineers of this country 
will become the directing factor in its government?" 

He went on to say that in the Belgium relief work, the engineers had 
worked things out on such a basis, that in one year, over one hundred mil- 
lion dollars had been saved to the Belgium Relief Corps. 

With reference to the engineer, Mr. Coffin himself said : 

"Who is there better fitted by technical training and by life experience 
for leading the way in this new era of Universal National Service than 
American Engineers? Will vision come to them? Will they translate vi- 
sion into action — and will they do it now?" 

In a letter I received from Mr. Coffin, he said: 

"I understand that there is at present no national organization among 
the concerns engaged in your work, and would like to suggest to you that 
the needs of the moment constitute the best possible reason for initiating a 
national policy of this kind. 

"I should think that the American Society of Industrial Engineers 
would answer the need discussed with you. You are, of course, the best 
judge as to whether or not there is already existing an organization through 
which the same result might be effected. 

"Upon general principles I dislike to see organizations multiplied fur- 
ther than necessary. However, I have no doubt but that we shall have occa- 
sion to use the mechanism proposed." 

The question now arises: Is there a need for an organization of In- 
dustrial Engineers and what can it do? 

There is need for the Industrial Engineer in practically every branch 
of the work necessary for successfully conducting the war. Unfortunately 
the number of Engineers of proven ability are few, and they are but a small 

40 



The Importance of the Human Factor in Industrial Preparedness 

fraction of the number required. The Industrial Engineer can accomplish 
little by his work in individual plants during the war for if all were em- 
ployed, the ground covered would amount to little in comparison with the 
number of industries turning out war products. 

While a man is limited, however, in the amount of personal work which 
he can accomplish, the amount of work that he can supervise, through a 
correct organization, is unlimited. The industrial engineers can best serve 
in this war by conveying through a proper organization, readily usable in- 
structions as to the operation of their most successful methods of organizing 
and increasing production, so that these methods may be applied by plants 
throughout the counry, with limited supervision. 

Among the things the Industrial Engineers can do are : 

1. List all available engineers and their special capabilities so that the 
Government can call on them when their special problems arise. 

2. Determine in the plants with which they come in contact anv prod- 
ucts that can be dispensed with and any necessary products for the war 
which the same equipment can be converted to produce. 

3. Determine all instances where male labor can be replaced with 
female labor. 

4. Determine the necessary steps to provide proper working and living 
conditions for the large number of women who must be employed. 

5. Determine the best means of rapidly training unskilled labor. 

6. Determine the best means of reorganizing departments and simpli- 
fying- operations so that unskilled labor may be effectively used. 

7. Determine in the community in which they are located the means 
which it' would be necessary to use, to put all plants on a twenty-four hour, 
full production basis. 

8. Determine the best means to increase production and at the same 
time maintain quality. 

The Need for National Co-ordination. 

I believe that the same trouble I found in the studies which led up to 
my recent book, "Industrial Preparedness," applies to the industrial and 
engineering movements — too much individualism. Those in the lead are 
men of strong personalities, virility, dvnamic power and driving energy, 
all of which makes for individual initiative and personal action. There 
should be some way, however, of harnessing these splendid characteristics, 
in such a way as to result in the achievements which would follow. 

It is unfortunate that there are already so many societies in the country 
with so little being accomplished from the standpoint of real organization. 
With societies to promote this, for the prevention of that and for the ad- 
vancement of some other thing-, the wonder is that any real and lasting good 
can be accomplished at all. There are hundreds of societies at work all do- 
ing some good, but think of what could be done if there was some concerted 
action based on intelligent direction. 

Engineering, if we consider it from the physical side, comprises mechan- 
ical, electrical, civil, chemical, mining, automobile and other branches. The 

41 



Western Efficiency Society Conference 



intelligent and efficient use of these branches for economic ends, constitutes 
Industrial Engineering. It should be obvious, therefore, that the Industrial 
group should be the factor which should correlate the work of the others, 
without their losing their identity or individuality. This would be the solu- 
tion if it could be worked out in a practical way. 

Hence, I believe that we should give the Council of National Defense 
an organization of industrial men who can perform the kind of tasks that 
their experience fit them for. 

As you all know, there are three functions in the successful manage- 
ment of any undertaking : 

1. The Executive Function. 

2. The Planning Function. 

3. The Performing Function. 

In the matter of organizing for and carrying on this war, the President 
of the United States and his Cabinet constitute the Executive Function. 
The Planning Function is the Council of National Defense with its advisory 
commission and the various boards working with it. The Performing Func- 
tion is the organizations, societies, plants and the people at large of the 
country. This latter function is a long ways from being properly organized, 
as we all well know. The difficulty with reference to the planning function, 
as analysis shows, is that it is an advisory proposition, studying and pre- 
scribing, responsible enough and made up of the best brains to be found, 
but lacking authority and the ability to get things done. 

You can, therefore, see that a disorganized performing function, with a 
planning function vested with advisory and analytical powers only, seriously 
handicaps the executive function, and the marvel to me is, not that President 
Wilson has done so little, but that he has been able to do so much, under the 
conditions he has been forced to work. Drive the conviction home to him 
that he needs better organization and you would be unable to keep up with 
his speed in putting- things across. 

There is some talk of adding three cabinet ministers to the present 
number, they to cover Transportation, Food and Munitions. There are ten 
now. This will, no doubt, help considerably, but it still leaves unsolved, 
the bigger problem of correct relationship between the three functions. 

In a letter to Mr. Coffin on April 23rd, on the need of National co-or- 
dination, I said : • 

"Could you not lay this matter before President Wilson with a view of 
convincing him of the dangers of the well-meaning activities of the many 
different organizations, all lacking co-ordination and definiteness of purpose? 
Could not he sound the call for a 'get together' of the various organizations 
on such a basis that would warrant each one, naming its best man, to con- 
stitute a national organization?" 

Possible Solutions. 

After careful thought, and discussing the matter with big men interested 
in the work, I want to propose for discussion and definite action at this 
conference, or by this society, at the earliest possible moment, the very 
things which will avert a serious explosion in national and military affairs — - 

42 



Western Efficiency Society Conference 



an explosion that President Wilson and the Council of Defense, while not 
responsible for it, will be unable to prevent. 

1. Organize the American Society of Industrial Engineers, which is on 
the program for Saturday. Let all of us sink any differences we might have, 
and give the Council of Defense a real answer to Mr. Coffin's request, in 
the way of a strong, patriotic and able organization of industrial men. 

2. Send President Wilson resolutions offering the services of this new 
society; outline its purpose and strongly urge him to issue a call to all soci- 
eties to "get together" and form a national body, without destroying their 
identity. 

3. Have the newly formed society offer its services to Dr. Hollis God- 
frey, of the Engineering and Educational Section of the Advisory Commis- 
sion, who is working in close conjunction with Mr. Coffin. 

4. Let the new society get right down to "brass tacks," perfect its 
mechanism and co-ordinate its resources, so as to be ready for the big thing 
I will now propose. 

5. Demand a national wide governmental investigation of all activities 
which have to do with war, both intradepartmental and interdepartmental, 
and with reference to the relation of the" Legislative branch to the Executive 
branch and of the Advisory branch (Council of Defense) to the Executive 
branch. This newly organized body of engineers will be made up of men 
who are reorganizing diversified activities every day. Running a govern- 
ment and especially conducting a war is a matter of the proper use of good 
business principles. Who then is better fitted to make such ah investigation 
than a society such as the one proposed. 

6. Place the conclusions following such an investigation before the 
President or Congress, or both, with definite recommendations for giving the 
government a comprehensive plan which can be worked out, from the top 
down as well as from the bottom up. 

7. Urge upon the leaders in Congress, the members of the Advisory 
Commission, and the President's Cabinet members, the absolute necessity 
for a strong central control of war activities, in the hands of a small number 
of men, either in the form of an "inner cabinet," or greater powers for a 
reorganized Council of Defense and Commissions under it. 

8. Finally, take steps to assist in organizing a national body of such 
societies whose work would be a factor in this gigantic preparedness pro- 
gram. 

Let the Executive Council of each society name a committee of three 
to five able men to work with its President ; let each President become an 
incorporator, under the laws of the District of Columbia, of a society to be 
known as the "ASSOCIATED AMERICAN SOCIETIES." Let this na- 
tional society select a President and an Executive Council and after dividing 
the work to be done into logical sections, covering definite functions, name 
a three to five man committee for each. This will furnish a real performing 
mechanism. 

The President of this national society and his Council will be in touch 
with the Executive Function of the nation, as well as the Planning Function, 

43 



The Importance of the Human Factor in Industrial Preparedness 

in the form of the Council of National Defense. The contact between the 
national society and any individual society would be through the President 
of each society and his committee, on through to the members. 

After all, the problem is one of matching requirements against qualifica- 
tions. The Council of National Defense will determine requirements. Some- 
where in the country, in the form of materials, plants, machines, men and 
organizations, are the qualifications needed. A strong executive function 
would co-ordinate the two. 

Conclusion. 

I have already taken up too much of your valuable time and there are 
other good things in store for you. In conclusion I want to drive home the 
fact that the situation is serious and that the allies need our help at once. 
The future of this Republic is in your hands ; it is for you to say whether 
autocracy or democracy is to rule the world ; what you do will determine 
the fate of 980,000,000 precious souls. Ladies and gentlemen— WHAT IS 
OUR PLEASURE? 

(Continued and prolonged applause.) 

THE CHAIRMAN : Just a moment, please. It is customarv in con- 
nection with the meetings to throw open immediatelv after the address, the 
meeting to general discussion. We are going: to limit this discussion to 
twenty minutes. This meeting will close at five o'clock; it is now 4:40. I 
am quite sure Mr. Knoeppel will be very glad to answer any question that 
either the members or guests have to ask. 

Mr. Knoeppel has sounded the opening eim for the conference in his 
masterful presentation of the subject to this Conference. 

MR. WALLACE : Mr. Chairman : I would like to take the time to say 
that this is one of the most informing and striking papers I have heard in. a 
good many days. I think that if this is the character of the papers that we 
will have throughout this Conference, we are going to make some history 
here in the next few days. I think the officers are to be complimented on 
being able to secure the presentation of such an able paper. I am very 
much pleased to know that it is £T>ing to be published, so I can study it at my 
leisure and get still more out of it. 

MR. F. M. SIMONS, JR.: Mr. Chairman, I might say that at the Hotel 
La Salle today the British Labor Delegation are holding their headquarters. 
It seems to me it would be a very pertinent thing for this meeting to extend 
an invitation to that delegation to attend this conference. They have passed 
for a number of years through the very problems that we are entering upon 
here. Their presence here would be of very great service to us, and it would 
be at least a courteous thing to do to invite them to attend this Conference. 

CHAIRMAN KESSLER: You have heard the suggestion, that an in- 
vitation be extended the British Labor Delegation to attend this Conference. 

(The motion was then put before the Society, voted on, and carried) 

MR. A. B. SEGUR: Tomorrow morning in this room there will be a 
free for all discussion on the subject of "Influencing the Management," and 
we would like to have with us those who have any special publication dealing 

44 



Western Efficiency Society Conference 



with the management of their works or anything pertaining to policy and 
organization, or other matters which may be of a special interest to us, and 
especially to the country at large. We want to make these round-table con- 
ferences mean the very most to the Society and to you, individually, and 
to the country at large. We all realize of how great importance this ques- 
tion of national defense and of industrial preparedness is. The only way 
we can follow out the suggestions made by Mr. Knoeppel here, today, is. to 
get together, and one great chance to get together is to come together first 
at these round table conferences. 

MISS FLORENCE KING: Mr. Chairman, I represent the Women's 
Association of Commerce of this city. May I interrupt just a moment? I 
was so interested in your announcement regarding this Association, and 
while I come here as a stranger, I was particularly interested, in the first 
place, about the democratic policy which the Western Efficiency Society has 
followed, and believe I may be pardoned if I make a suggestion. 

I have been so deeply interested in the paper that the gentleman has 
read this afternoon, and in your reference to the work that the women are 
doing in this great national crisis. I represent a body of women here in 
this city whom I know would be deeply interested, if this Society could find a 
place in its deliberations where the work that women will be called upon to 
do, and the responsibilities that they will have to assume, could be consid- 
ered in connection with the other matters that you are taking up. We all 
know that greater responsibilities are being placed upon women today than 
ever has been done before. We know the preliminary work they are now 
doing, their willingness to serve in every capacity they possibly can; but I 
know from my experience with women how inexperienced they are in these 
things, how very hard it is for the wife to take care of the family with the 
husband away at the front. If she could have a little help and encourage- 
ment from an organization like this, I think you could perform no better 
service beore you adjourn this Conference, than to give a little consideration 
to this, if you please. (Applause.) 

MR. A. B. SEGUR: I would like to suggest again, since Miss King 
has spoken of the matter of the consideration of the women's problem, that 
that is one of the things for which the round table was first originated, to 
give expression to just such things as those which were not contained in 
the regular program. May I suggest again, that on Friday afternoon one 
speaker, Mr. W. S. MacArthur, will take up the work of the women, on 
the question of "Woman's Work in War Time," and as chairman of the 
round table I would like to again extend to the Woman's Association of 
Commerce, of this city, an invitation to attend those round table meetings 
and bring up those discussions. 

MISS KING: Thank you. 

MR. D. ULLRICK: I noticed that when we got the answer of Presi- 
dent Wilson to the offer of our services, it was a stereotyped form, printed 
by the millions, I presume, and sent back to every organization that sent 
in an offer of their services. I presume it never got to Secretary of War 

45 



Western Efficiency Society Conference 



Baker, and he had no idea at all that it was an institution like ours that has 
offered its services. 

It seems to me that the thing that is necessary is a sort of back fire. 
Now, the people, the societies, the organizations that pass these resolutions 
and offer these services, are likely to sit back and say, "I have done my 
part." "I have offered my services." And the people, the business men, 
the manufacturers and everybody else wonder why something isn't being 
done. The only people who can do anything that will reach the Secretary 
of War, as I understand it, is the Congress. This committee that we have 
down there, or commission, may advise, but they are helpless to do any- 
thing, because there is no provision for activity and for carrying out their 
advice. As was remarked, we have a number of lawyers and politicians 
in Congress ; we have people there whom we have put into power and 
whom we would not think of putting in at this time, if the question of their 
selection, of sending them to Congress, were made an issue at this particu- 
lar moment, but they are there. Consequently, while they are being del- 
uged with the general form of comunications, as we have personal con- 
tact with them, the thing to do is to use our influence and to send individual 
words or advice to them, as to what we have done in this respect, and try 
to get action from that side. On the other hand, we need to carry publicity 
to the general public, or knowledge, rather, of such things as we are doing. 

We have got a lot of cheer this afternoon, by people who would spread 
the ideas we have heard here and make the body politic of this city aware of 
what we are undertaking to do. Democracy is a slow-moving element, and 
we must carry the ideas to the people, as well as to the powers above. 
Therefore, I think that it is well for us to go out of our way in order that we 
may get our neighbors to come here and make this a popular movement 
as well as an organized movement. All of us have got the same formal 
reply from the President, and will have the same sort of treatment. Our 
efforts will end where other efforts have ended, unless we do something big- 
ger and broader than offer our services to the President. 

As a practical suggestion I hope that we will have this matter of a cen- 
tralized propaganda and effort in efficient methods and of purposeful action 
on the part of these organizations worked out until it finally breaks through. 
This is the measles that we have in this country ; it is coming out in spots ; 
it has got to reach the brain and head of the country, somehow or other. 
(Applause.) 

MR. WALLACE: With reference to personal contact, there are a 
number of mechanisms that can be utilized in Washington. There are a 
great many people who are attempting to subordinate the activities of the 
political force. At the same time, Mr. Creston, Columbia University, who 
is a big factor in Washington, can take a big delegation from one or two 
societies, tell them what to do and where to go in such a way that you can 
get your line of contact so that the Secretary of the Navy will have to listen. 
But don't send just a resolution and letter, because they will reach the waste 
basket. The way can easily be paved for the Society to do that. 

MR. RHEINFELDT: Mr. Chairman, democracy is the organizer; let's 

46 



The Importance of the Human Factor in Industrial Preparedness 

do it now, in regard to the Industrial Engineers' Organization. I move 
you, Mr. President, that a committee be appointed to draw up a rough draft 
of this organization of Industrial Engineers. 

CHAIRMAN KESSLER: Mr. Rheinfeldt, in that connection I am go- 
ing to call on the Chairman of the Executive Board Conference, who can 
answer you. 

MR. BERNDT: Mr. Chairman, as regards the executive committee, 
this committee has already been authorized by the Western Efficiency Soci- 
ety to go ahead with the plans. We are from day to day, as we find response 
among the delegates of the different societies, adding to this committee, and 
we are going to hold a preliminary organization meeting next Friday morn- 
ing, so as to have the plans ready for Saturday. That is the present pro- 
gram. Mr. Knoeppel has already consented to act on that committee, and 
we are hoping — this is rather embarrassing — but we are hoping to get Mr. 
Emerson to act with us, and we are hoping that every day as more of the 
men come to the Conference that we will finally get the co-operation of all. 
That is the present plan. And it would seem a practical plan as well. We 
are holding conferences, we held a conference this morning, one yesterday 
afternoon, expect to have another one this afternoon, and we are hoping 
gradually to work up to the final development Friday morning, and then 
throw the whole thing open for discussion on Saturday. 

I would like to say this : That Mr. Knoeppel has seen the possibility of 
the affiliation of industrial engineers simultaneously with the Western Effi- 
ciency Society. It is a definite fact that the possible organization of The Soci- 
ety of Industrial Engineers came with this Conference as a result of the 
plans for the Conference, and Mr. Knoeppel was working from his end, and 
it was very fortunate that we got together. We feel that many of the other 
men who are going to be represented on the Conference program have prob- 
ably seen the same possibility and there is very little doubt in our mind but 
that we will have the co-operation of all before Saturday for this democracy 
is not working slowly. (Applause.) 



47 



SECOND SESSION 

Wednesday Evening, May 23, 1917 

THE PRESIDENT: We were sorry at a late hour tonight to learn 
that Mr. Leon C. Marshall, of the University of Chicago, who was to be 
Chairman of the meeting tonight, is sick. We are fortunate, however, in 
securing the services of Mr. Harry Franklin Porter. Mr. Porter has been 
the editor, or rather connected editorially with the System Magazine, the 
Factory Magazine and the Engineering Magazine. He has also been a lec- 
turer in Industrial Engineering at the Universuy of Illinois and at the Uni- 
versity of Michigan. During his residence in Chicago Mr. Porter was one 
of the most active members of the Western Efficiency Society. At the pres- 
ent time Mr. Porter is in charge of the development of standard practice for 
the Detroit Executives' Club. Mr. Porter. (Applause.) 

MR. HARRY F. PORTER: Mr. President, Ladies and Gentlemen, 
After this rather embarrassing introduction I will now proceed as befits a 
chairman to extinguish myself as quickly as possible and be true to my 
name, the porter at the door, merely to allow the distinguished gentlemen 
on the program to reach your attention as soon as possible. I do, however, 
want to take just one or two moments to emphasize the importance of the 
subject of tonight's conference. I think all of those who have had contact 
with the management realize that the biggest problem after all is to educate 
the management. As the speaker of the afternoon, Mr. Knoeppel, pointed 
out, information travels from above down, and therefore you have got to 
reach the men at the top. The dominating mind they have got to see the 
vision of this thing, see the importance in connection with this whole con- 
ference with the human factor before you can bring the right policies and 
the right measures into action, into port. So. then, the subject of educating 
the management to the importance of the human factor, I consider one of 
the big subjects, one of the biggest things, the conference could address it- 
self to. There are two problems before us. One is to reach the managers 
we now have, no matter how they got their positions, whether they came in 
through the cabin or through the forecastle ; the other is to rear up a genera- 
tion of young men technically trained, with the proper viewpoint, so that 
when they do get in the position of command they will have the proper 
appreciation of these various problems, and, above all, with the human fac- 
tor. With that brief prelude it seems hardly necessary for me to say much 
in introducing the first speaker, he is" so well known to all of you. My pre- 
diction is that Harrington Emerson will go down to posterity as the pioneer, 
as the greatest teacher and inspirer of thought along efficiency lines, that 
this generation has produced. I know he has been a source of great inspira- 

48 



The Importance of the Human Factor in Industrial Preparedness 



tion to me. It was his article on the Twelve Principles of Efficiency in the 
Engineering Magazine that drove me into the movement, and I am very glad 
to be here tonight to tell you about the effect of those teachings on me, and 
it is a source of great gratification to me as I go around the country and 
mingle with managers, to see the philosophy that has so ably been ex- 
pounded by him in times past bearing fruit all along the line. I take a great 
deal of pleasure and esteem it a high honor and privilege to introduce Har- 
rington Emerson. (Continued applause.) 

''EDUCATING THE MANAGEMENT TO THE IMPORTANCE OF 

THE HUMAN FACTOR" 

Mr. Harrington Emerson 

Ladies and Gentlemen : There are truths learned in youth but not real- 
ized until old age approaches. When I was a young man I heard the maxim 
that young men were for war and old men for counsel. It never came home 
to me so much as this afternoon when I gathered in this room with these 
active, vigorous, intelligent young men of the Western Efficiency Society 
and when I realized with sadness that my days for war are over, and that 
what remains to me is chiefly the function of counseling. Kipling in one of 
the most splendid stories he has written tells of a Brahmin who, obeying the 
old law, was for twenty years a student, for twenty years a soldier, for twenty 
years a statesman, and then the halls that had known him knew him no 
more. He went out from the palace gate a beggar with the begging bowl, 
and the yellow robe. The former statesman whose favor kings had sought 
was lost on the great highways of India. He gave the balance of his life to 
thinking and reflecting about the eternal verities and not to the considera- 
tion of the little affairs of men. But that same division of life occurs for all 
of us. For twenty years we are children, learning; for twenty years we are 
in active life and doers ; for twenty years, if we progress as we should, we 
are executives; and then when we reach three score, if we have done well, 
we can pass over and take our place among the counselors. 

It is only recently that we have come to recognize the very great dif- 
ference in value between different kinds of materials and different kinds of 
equipments and different kinds of men. If you go back into the oldest days, 
you find that precious stones were considered the most valuable form of 
material. A diamond, a ruby, was many thousand times more valuable than 
a piece of copper, but today we have materials that are immeasurably more 
valuable than anything that the ancients ever dreamed of. A pound of 
radium, if we could collect a pound of radium in all the world, would be 
worth $5,000,000. Similarly with equipment. We do not hesitate to spend 
half a million dollars in making a telescope to explore the recesses of the 
universe, but when it comes to man, the difference is far greater than that 
between one piece of equipment and another, between one kind of material 
and another kind. I was reading in one of your papers today that the loans 
made by the Allies had amounted thus far to $42,000,000,000, and yet even 

49 



The Importance of the Human Factor in Industrial Preparedness 

before the war began I tried to estimate the value to humanity of the man 
who discovered the hook worm and evolved the method of checking its rav- 
ages. This one man brought additional possibilities of wealth into the 
world amounting yearly to $20,000,000,000, so that the work of that one 
American physician, whose name I do not even recall, is capable of adding 
to the world in a single year, and in every year for all time to come, half as 
much in value as all the Allies have spent to date on this great war. 

The topic which I am supposed to speak to you upon is that of educat- 
ing the management. 

Just fifty years ago I entered a very strict school. It was the first time 
that I had gone away from home. This school had three principles of 
classification of the students: age, for living; capacity, for study; strength, 
for play. We were assigned to our living group according to age, so that 
my nearest room companion was a boy who happened to be born on the 
same day, the one on the other side of me was two or three days younger, 
and so in our daily lives we were grouped according to age. But in our 
classes we were grouped according to past training, so that two boys who 
lived side by side in their daily lives, because of the same age, one might be 
in the first ciass in history but in the last class in mathematics, and his near- 
est room companion might be in the first class in mathematics but in the 
last class in history. In our games I was matched against the boy, not of 
equal age or equal capacity, but of equal strength. We lived with our age 
mates, we studied with our brain mates and Ave played with our physical 
mates. 

The result of this three-fold classification was that they got a great deal 
more out of us in this school than any other school I ever knew in my whole 
life. They did as much with us and to us in eighteen months as is usually 
accomplished in four years in other schoois. It is true that they kept us at 
it tourteen hours a day for 365 days in the year, but the results were worth 
it. Ten years later I was myself a teacher in one of our younger western 
state universities and in my hrst year all sorts of students flocked into the 
class, and I" gave 90 per cent of my time and effort to 10 per cent of the stu- 
dents who were utterly unfit to be in that class, and I gave about 10 per cent 
of the time to the few students at the top who were most deserving of atten- 
tion. When the second year came around I changed all that. I didn't 
allow anybody even to enter the class who could not show a certain amount 
of aptitude for the subject, a proper preparation, so I excluded all those 
to whom in the first year I had been giving 90 per cent of my time, and I 
concentrated 90 per cent of the time on the students who really repaid the 
attention. All this occurred forty years ago. Quite recently I was much 
gratified to receive a call from three of my old students I had not seen for 
thirty-five years. One of them was a judge, another was one of the most 
successful New York bankers, the third was the mother of grown and suc- 
cessful children. When they saw me they began to recite the lessons that 
I had taught them forty years before. They said, "You pounded those les- 
sons into us and we never have been able to forget them, and we can't look 
at you now without immediately wanting to recite." (Laughter.) 

51 



Western Efficiency Society Conference 



In one of my vacations I went to the fossil beds of Wyoming and Utah 
and there I came in contact with the work of the great Scotch geologist, 
Geikie, and with the works of other great geologists who had been then col- 
lecting fossils and making a study of palaeontology, and there I learned that 
if you discover a piece of horn of some fossil, you know at once, even though 
you only have the one piece of horn, that the animal had cloven hoofs, that 
it had certain kinds of teeth, that it had a certain kind of stomach and diges- 
tion; the hog has cloven hoof but no horns, but every horned animal has 
cloven hoofs. From a tooth it is possible for a palaeontologist to recon- 
struct the whole animal. I remember a story of some students who wish- 
ing to frighten a professor, dressed up as devils and broke into his room at 
night. When he woke up he saw r these figures with horns and cloven hoofs 
and a fierce face and a tail. The professor said, "Horns, hoofs, eat grass — 
they can't harm me." (Laughter. > 

All of us can see the difference between a bulldog" and a greyhound. We 
know that the bulldog has determination, steadfastness; we know that the 
greyhound has speed. Recently I listened .to a lecture which gave me a 
great deal of satisfaction. The lecture was illustrated by the skull of an old 
man who was supposed to have lived 300,000 years ago. The jawbone was 
much heavier than in the modern skull, the attachments for the muscles 
were very much wider and larger, so that it was evident that this primitive 
man had very strong muscles. He was a wild beast of a man and because 
our ancestors half a million years ago used to bite and hold on like bulldogs, 
we today are sending millions of pounds of chewing gum to the soldiers 
abroad so that when they go over the top or are suffering agony from 
wounds, they can manifest and increase their determination by clinching 
their jaws on the gum. In former decades British sailors, when being 
flogged, always bit on a soft lead bullet so as to stand the torture. One of 
my stenographers said he used to watch me and he thought I was chewing 
gum. I wouldn't dare go home if I did chew gum. (Laughter.) He got 
the matter wrong end to. He saw the jaw muscles moving and he said 
afterwards, when he got the manuscript, he perceived that I had been "going" 
for somebody, I had been trying to "put something over," I had been clench- 
ing my physical jaws on mental or moral opponents. When you see any- 
body with strong muscles over the lower jaw r it is an indication of stick-to- 
it-iveness, or of steadfastness, or of reliability, because in the long past the 
men who caught hold with their teeth and held on developed the habits and 
the characteristics of steadfastness. 

A number of years ago I was at Battle Creek for the first time, and I 
met there an old doctor who told me that from a single tooth he would be 
able to tell the sex, age, the color of the hair, and the general disposition of 
the person to whom it belonged. I tested him out and I found that he was 
able to do it, but I didn't take the lesson to heart. I thought he possessed 
some kind of uncanny second sight, some mysterious gift which others 
lacked. I did not realize that there might be others as skilled or that even 
I might also learn. Yet it would have been of immense advantage to me if 
I could have taken him as counselor to advise me as to the selection of 
business associates and employes. 

52 



The Importance of the Human Factor in Industrial Preparedness 



About the same time I was reading- Francis Galton's works and he 
explained why it was that in South Africa they have these many spans of 
oxen in front of a single big" wagon. You may all remember that in the 
early geography you studied you saw those pictures of a big wagon of 
immense size — almost the size of a freight car — and the long span of oxen 
strung out in front of it. Even as a boy I realized that life was cheap in 
Africa, and I wondered why it was they had so many oxen on one big 
wagon instead of having fewer spans and many wagons. Francis Galton 
says that an ox willing to go ahead into the jungle where he may meet lions 
is exceedingly rare. What the ox wants to do is to force himself into the 
herd. He saw oxen who when outside of the herd showed every evidence 
of suffering, of misery, but when they horned and hoofed their way back 
into the center of the herd they were beautifully happy and satisfied. Whv? 
Because they knew that they were surrounded by other oxen and if the 
lions or the leopards attacked it would be the other oxen who would be hurt. 

Most oxen are born pacifists. When there is any belligerency they 
want to be neutrals. The bull is° different. I would rather be a bull than 
an ox. 

The problem that confronts the Kaffirs is to find oxen with initiative, 
for none others are fit to lead. So the Kaffirs watch the little calves, and if 
they see one that goes away from its mother fortv or fiftv feet to investigate 
some plant or to pick up a leaf, they immediately pick it out and beg-in to 
train it, and the oxen that become the leaders of their long spans are selected 
in this way. There are so few that a single span of leaders will be worth 
all the other forty oxen put together. 

Between 1895 and 1912 I tried out thoroughlv the old method of select- 
ing friends and associates and employes ; namely, by accident, expediency 
and recommendation. All three methods very poor, recommendation being 
the worst of the three. I did actually divide people into two classes, with 
the devil's choice between them, the competent scoundrels and the incom- 
petent eoody-goodies. In this part of the world there is- a laree middle 
class fairly competent and also fairlv reliable, but on the Yukon when I was 
there I found the scoundrels who had to leave this Dart of the country, seek- 
ing" a new home, a new place of adventure, and I also found the ne'er-do- 
wells who could not succeed in this part of the world and had been sent up 
there as a last hope. 

The Yukon was a region of extremes, and when it came to making a 
choice, I always chose the competent scoundrel in preference to the incom- 
petent eoody-eoodv, because at least there was some chance of netting there 
with the competent scoundrel, and there was none at all w'tih the other 
fellow. 

Until recentlv, West Point and Annaoob's had oerhans the be^t method 
of selecting- men Dracticed anywhere in the United States, but basicallv the 
first start was wrone. because the cadets were nominated bv Congres c men. 
and. nerhaos out of a district with 5.000 young- men in it. only two or three 
would be nominated. But out of those thev were very careful to select 
those who were phvsicallv fit, mentally fit, morally fit, and the result was 

53 



Western Efficiency Society Conference 



that they secured a very high class of young men. A number of years ago 
we were counselors to a large industrial plant not very far from Chicago, in 
which one of the chief troubles was the great turnover of the men. The 
loss of 100 per cent of their men in a year — that is, for 2,500 men they would 
have to employ 2,500 new men in the year — was a serious one. It was the 
chief difficulty, one of the first difficulties .about the operation of that plant, 
and for the first time I really realized that it might be more important to 
better the men rather than to better the machines. Then I remembered that 
the class of men in the United States who have done more in initial selec- 
tion, who were earlier in the field and carried their plans further than any- 
body else, away ahead of employes, away ahead of doctors, away ahead of 
the professors, were the race-horse men. Fifty years ago a race-horse man 
wouldn't race a horse unless he knew it was pedigreed. He wouldn't dare 
trust an animal that didn't have renowned grandsires and granddams. What 
did the race-horse men do? They first selected the pedigreed animal even 
before it was born. They next carefully gave it the proper environment. 
After it had developed under the proper environment they gave it the most 
careful training and attention, provided it had shown the proper kind of 
aptitude, and then came the experience of the actual race-track, and on the 
strength of demonstration the horse finally acquired value. They applied 
to the selection of race-horses all the methods that we now realize are those 
that ought to be applied to the selection of employes. 

Incidentally it was the race-horse men who first used the stop-watch 
and made time studies, wfio first used photography for motion studies. The 
first photographic moving pictures ever made were of race-horses, in order 
to analyze the movements of their legs. It w r as also race-horse men who 
standardized equipment (harness, shoes, sulky) and also standardized dis- 
tances and tracks. 

It is only recently that we have begun to study and to teach managers. 
There is only one manager with whose life I am intimately acquainted and 
that is myself, and perhaps what I can tell you of my own experiences will 
have, for the younger men, more practical value than a theoretical essay. 
1 am telling you younger men what I learned late in life that you may apply 
it while you are still young and thus escape the mistakes I made. 

From these experiences of my own and of others you will see why it is 
that I believe : 

(1) By fitting the man to the social, mental or physical grade for which 

he is qualified and then developing him by the strictest discipline. 

(2) By observing the physical makeup and recognizing the mental and 

social traits that are indissolubly bound in with the physical as 
steadfastness with the strong jaw. 

(3) By watching inherent aptitudes and getting a position in which 

they are useful. 

ence combined to fit for a particular task. 

(4) By using- heredity, environment, training, education and experi- 
students of this subject have polarized into three schools and each one 

But instead of being willing- to use all methods of ascertaining fitness, 

54 



The Importance of the Human Factor in Industrial Preparedness 

denounces the other as being unorthodox. There is first the psychological 
school, then there is the school that relies on mental and physiological tests, 
and finally there is the school that relies on observation. The psychological 
professor, if he wanted to find out whether you were honest or not, would 
count the beats of your heart while you were reading a letter in which per- 
haps you were accused of dishonesty. If the heart beats were accelerated, 
he would conclude that you were indignant at being accused of dishonesty, 
and that therefore you were an honest man. (Laughter.) This method has 
its value undoubtedly. It is the modest girl who blushes a great deal. The 
trouble about this method is that you can't always put this mystery machine 
on a man's heart or on a woman's heart when you wish to find out whether 
he is honest or whether she is honest. It is therefore difficult of application. 

The second method is to give the man a number of questions. In 
answering them he will inevitably reveal whether he is honest or dishonest. 
I remember a question of that kind that was once given to some of my 
young men. They w r ere asked whether if the wife were about to die and 
the only way of getting the money to pay the doctor was to steal it from 
the bank in which they were acting as cashiers, would they steal the money? 
If the young man said, "Yes, in an emergency of that kind, if I couldn't get 
the money in any other way, I would take it," it was immediately realized 
that the young man's principles as to honesty were not so fixed as to be 
unshakable. 

The third method is to look the man in the eye and decide immediately 
whether he is honest or dishonest. The great advantage of this method is 
that it can be applied always and everywhere with the very least amount of 
trouble, and while I am not skilled myself in its use I think it is infal ible 
when applied by one competent and trained. It is particularly applicable to 
strongly marked characters. It is ea^y to distinguish black from white, the 
criminal from the high-class man. It is not so easy to distinguish and char- 
acterize the colorless greys, the mediocrities. 

We have found in our own classes that there are some twenty to twen- 
ty-four screens by which men can be tested, and if a man has passed through 
all those twenty-four screens, there is very little possibility of his not fitting 
into the place for which he has been selected, and some of these screens are 
so obvious they would scarcely occur to you. I shall go down through 
them. The very first thing I ask myself about any particular w r ork is 
whether it should be done by a machine or by a sentient being. Very often 
the answer is, this is work that ought to be done 'by a machine. This cuts 
out immediately the sentient being, whether animal or man. But if the 
answer is sentient being, then the next question is: animal or man? Some 
jobs are better done by dogs than by men; for others mules are very much 
more valuable ; for others horses ; but suppose that you finally decide it is a 
job that requires a man, and we generally want a man, not for muscular 
strength, but for supervising intelligence. The next question is that of age. 
The age limits may be wide, as between 14 and 70, or they may be tightly 
drawn, as between 21 and 31, or still closer, as between 21 and 25. . The next 
screen is that of sex. There are an immense number of occupations for 

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Western Efficiency Society Conference 



which one sex or the other is suited. The fifth screen is that of race. I 
remember once sending an assistant who belonged to one of the highest and 
leading families of Japan into a machine shop in Bridgeport, but I had to 
withdraw him, not because he wasn't skilled, not because he wasn't a gen- 
tleman, but simply because the Americans said that they wouldn't have any 
Japs in the shop. In this case, owing to narrow ignorant prejudice, race 
was a barrier to the employment of a man who might have had all the other 
qualities required. 

Nationality is the next screen. There are certain occupations for which 
I would prefer an Italian; for others Frenchmen would be very much bet- 
ter, cooking, for instance; and others in which we would want an American. 
Heredity is the seventh screen; other screens are — (8) eugenics, (9) past 
environment, (10) mental condition, (11) physical condition. 

I was recently tested at Battle Creek as to physical condition. One of 
the interesting tests was with a muscle machine of which only a few are in 
existence, one at Battle Creek, one at West Point and one at Annapolis. 
This machine revealed every weak or deficient muscle. Suitable exercises 
can be devised to correct the weaknesses. Undoubtedly something can be 
similarly done to correct mental and social weaknesses. 

(12) moral condition, (13) industrial condition. 

Now we go over these same four qualities again with reference to the 
aptitudes. A man may be perfectly sound .mentally, but what are his pecu- 
liar mental aptitudes? One man has one kind of an aptitude, and another 
man has another kind of an aptitude. In both cases the man is sound, the 
man is good, but there is a difference in aptitudes. What are the physical 
aptitudes? One man has one kind of a physical aptitude; for instance, we 
might say wrestling; another man has the physical aptitude for running, 
lumping, playing baseball. What are the moral aptitudes? Two men may 
be perfectly moral, but in different ways. One has moral aptitude in one 
direction, another a moral aptitude in a third direction. What are the indus- 
trial aptitudes? We finally take up his training, education, experience, tem- 
perament and. his demonstrations. 

When a man has been put through all those different tests, why, we 
know that we can fit him to the right place. Recently we wanted to find a 
man for a rather commonplace job, in connection with some railroad work, 
and we put an advertisement in one of the large New York dailies. We 
mentioned that we wanted a young man, American born, between the ages 
of 24 and 26, a college graduate, technically educated preferred, willing to 
leave home at a stated salary. That advertisement was read by 180,000 peo- 
ple and naturally its wording cut out all the foreigners ; it cut out all women ; 
all men below 24 or over 26 ; it cut out all those not college educated ; it cut 
out those that were not technically trained, those who were not willing to 
leave home. Finally it cut out those who already had better positions. 
Then we asked for photographs and when they came Ave had 360 photo- 
graphs and in a single afternoon we were able to examine 350 of those and 
reject them, bringing the choice down finally to ten. When a man sends in a 
photograph and he is trying to make a good impression, and he has a cigar 

56 



The Importance of the Human Factor in Industrial Preparedness 

in the corner of his mouth, and his hands in his armpits, and his feet up on 
the table, you need nothing further. (Laughter.) 

Tact is a very valuable quality. Such a man might have had all sorts 
of good qualities, but he didn't have the one esesntial, and it is a very curi- 
ous fact that the essential things are not those usually specified. Tact in a 
cashier may be as important as honesty and more important than accuracy 
or rapidity. 

When we want a good accountant, accountancy is the very last thing 
we test the man for, not the first, because what is the use of getting a good 
accountant who is dishonest or getting a good accountant who is quarrel- 
some or who is disobedient? The qualities that we have first to pick out are 
those of honesty, of amiability, of obedience, and if we find that kind of a 
man or a number of men of this kind, then we select the man who in addi- 
tion has the dualities that make him a good accountant. 

In the period in which we now live, it is of enormous importance to the 
United States to have the right men in the right nlace, and what I want to 
urge on you going" out into this great world conflict as advisor^, as direc- 
tors, as guides, as helpers, is that you should call the attention of that great 
manager, our Government, to how easv it is to annly certain tests, elemen- 
tarv tests, that will enable us to avoid the terrific mistake of taking- the 
wrong kind of material for these positions on which the lives and the future 
of so manv of our vounp* men will defend. (Aonlause.") 

CHAIRMAN PORTER: After having- heard this truly masterful ad- 
dress of our distinguished friend and counsellor, Mr. Emerson. I think we 
are well prepared to pass on to the second phase of the eveninp-'s oroorain 
under the general head of "Training the Future Generation." which will be 
set forth bv three gentlemen, one renresentine the viewpoint of the schoob 
and the other two nresentinp- the viewpoint of the larp- e industrv who recog- 
nize this preat problem and who has orp^mVed itself efficiently to solve it 

The first speaker of the trio is Dean Wdlard E. Hot^hkiss. of the School 
of Commerce. Northwestern University. Northwestern University has be^n 
one of the oioneer universities to reroo-nive the imoorranre of trained sci- 
entific administration, and has done its bit to nrenare the future p-^neration. 
It pn've^ me a great deal of Measure to introduce to von Deqn TTofrhki^c 
who will talk to you on the "Function of the Educational Institution." ( An- 
plause.^) 

TRAINING THE FUTURE GENERATION-FUNCTION OF THE 

EDUCATIONAL INSTITUTION. 

Dean W. E. Hotchkiss. 

Mr. Chairman, Ladies and Gentlemen, We are living in a time when it is 
of the utmost importance that we do things in the present, when it is of the 
utmost importance that each of us do the thing that we are best equipped to 
do, and that each of us do that thing in such a way that it will be properly 
articulated and co-ordinated with what the other man is doing. That matter 
of co-ordination and articulation of the work of many men, many organiza- 

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Western Efficiency Society Conference 



tions and many agencies, within the next few months is going to determine 
to a very large extent whether we shall do our work well or ill, whether this 
nation, shall do the great tasks before it in a way that will reflect credit upon 
not only the moral spirit and the moral purpose, but upon the efficiency of 
this nation. 

There is no question about the great moral impulses that lie back of 
democratic government, whether it is represented in this government, in 
this country, or in other countries, but there is a question in the minds of a 
great many men as to whether democratic institutions in the great final test 
of force which we are undergoing at the present time, can pull themselves to- 
gether in such a way as to put forth a thoroughly efficient effort in the cause 
which they have undertaken. Under those circumstances it may seem just a 
little bit beside the point for us to stretch at this particular time the question 
of the training of the future generation. It may seem that perhaos we 
could be better occupied at the present moment to see what we can do with 
the people who are trained as thev have been trained in the oast to p-et the 
larp-est measure of efficiency, but T think if we look beneath the surface we 
will see that perhaps the sort of thines we are goine to dcveloo in +Vie Gen- 
eration that is about to beein its work, mav give 11s some cine as to the Vind 
of dualities which we can attemnt to seek out and to p-et into nersons where 
thev will function to the best advantage in the present emergency. So that 
I think it is not entirelv beside the mark for us under these circumstances 
to be trying to find out what it is that we are aiming to do with the gen- 
eration about to begin its work. 

When vour Program Committee asked me to anpear here this evening 
I realized that there was not time enough to devote verv much pTt^ntion to 
the w r orkine out of a speech, and it seemed to me that the best thino- thsr T 
couM do was to try to lay before von in as sincere a wav as nos^i^V w^at 
I might perhaos describe as the faith that is in me c.oncerrnno- tV«^ W orV 
which a university ought to undertake in the direction of t^* trains or of 
general managers and executives, becau c e it seemed to me that while fVie 
universities w T ill inevitably be occupied in training men who will po mtd 
expert notions where thev will be under the direction of executives, rh^t 
the ultimate aim is to make the university men readv to nass on from tV.^ 
positions where thev will be under direction to the positions where they will 
be doing the directing themselves. 

The training of experts, therefore, specialized experts, I regard as an 
intermediate stage, perhaps a by-product of what the universities ought to 
be doing. 

When we ask the question what the universities can do in this connec- 
tion, we have to consider first what is the nature of the responsibility of the 
university in the undertaking of this kind of a task. I am not going; to de- 
lay the discussion very long to elucidate that point, because it seems to me 
that you will all agree that fundamentally the obligation of the university, 
whether it be a university that is supported by taxes, a university that is 
supported from the income of the endowments, or a university that is sup- 
ported by student receipts, the fundamental obligation of the university is 

58 



The Importan ce of the Human Factor in Industrial Preparedness 

to the great general public. Their obligation is to train men who, while 
they are effective in earning their living and developing in their particular 
line of work which they will undertake, at the same time will be effective 
citizens of the great republic. The university in its professional forces, I 
take it, as in its industrial forces, has that fundamental obligation to train 
men who are going to be citizens, effective citizens in business, citizens 
doing a particular kind of work, but citizens who recognize the obligation 
for citizenship, so it does behoove us in attacking particularly this question 
of human relations in business, to consider the welfare of the state, the 
welfare of the state not only in periods of great emergency like this, but the 
welfare of the state in the ordinary limitations of business. I shan't under- 
take to demonstrate that point because I do not think it needs demonstrat- 
ing. 

The second thing", it seems to me, that we have to consider in discuss- 
ing this question of the work of the university, is the question : What is a 
university equipped to do? Not only its responsibility, in what direction 
does the responsibility lie, but what fundamentally has the university to do 
and to do effectively? What can it do perhaps in a better way than it has 
done after the young man who goes to the university has gone out in busi- 
ness? What are the limitations upon it with reference to conduct, what are 
the things that can be bettered after the student leaves the university? And 
I, for the purpose of system, have grouped the things that I want to em- 
phasize as within the scope of university work, under three headings. The 
first of these things, which, it seems to me a university is equipped to do, is 
to train its students to the significance of scientific method as applied to 
business data. I think the whole definition is essential, scientific method 
as applied to business data. 

Now, we do in all of our universities furnish students some opportu- 
nities to get a training in scientific methods, whether they take courses in 
business administration or not. A student goes through a chemical labora- 
tory, and if he doesn't get something of the nature of scientific methods it is 
his own fault, but there are a great many men who have a great deal to do 
with the use of scientific method in a university, and who are looking for- 
ward to a business career, and who at the same time never realize that this 
scientific method that they are getting in the university in these courses in 
chemistry, physics, and biology, is a method of application which can be 
used in the solution of business problems. For that reason I think it is only 
essential for us to give our students instruction in the course of scientific 
instruction, which, I think, it is necessary for us to render in the applica- 
tion of scientific method to business data, so that when they go out they will 
have formed a habit of mind so that when they undertake to approach a 
complicated mass of data, a lot of information, or to decide how a particular 
piece of work is to be done, who is going to do it, how a particular depart- 
ment is to be organized, that they will instinctively proceed along the right 
line, that they will see both sides of the equation and do away with all dis- 
turbing third factors until they get the things they want to know in such a 
way that they can analyze their problem from the standpoint of the most 

59 



The Importance of the Human Factor in Industrial Preparedness 

fundamental factors. If a university is not equipped to train students in the 
essentials of a scientific method of analyzing data, whether that data be 
business, or whatever it be, that university is not equipped to do anything, 
so that I w r ould put down as the first thing which a university is equipped 
to do, the installing in a student's mind of a respect for a scientific analyti- 
cal method of approach to problems, so that he instinctively will go at his 
own problems in that way. 

The second thing, it seems to me, that a university can do, is to de- 
velop an appreciation of the importance of the human relations aspect of 
business. We are dealing tonight with this subject of human relations, but 
we haven't always emphasized that particular point. I remember when our 
own school of commerce was established, that we w r ere talking of a business 
in terms of banking, transportation, insurance, accounting, but in terms of 
the great departments into which business was divided. We had a depart- 
mental view of our problem. We began to realize that if the universities 
were going to do anything worth while in the field of business education 
they must get at the real problems of internal management and organiza- 
tion and not confine themselves merely to the problems of the great outlying 
and underlying business fabric of the country ; that they would have to find 
out what it was that was being done in specific business concerns, what are 
the different kinds of work that are being done in a business establishment, 
whether that establishment be a railroad or a factory ,or a mercantile estab- 
lishment or what it is ; and when we began to approach the problem from 
that standpoint of internal organization and management, we saw that our 
proper line of division was not the department but rather the functioning. 
We came to a functional as distinguished from a departmental organization 
of our problem, but still for a number of years we laid the emphasis in 
our functional viewpoint upon the handling of materials, upon the maximum 
of business. We had what the colonists called a mechanistic idea of the 
problems in business, and we passed very lightly over the question of human 
relations. Today I think we are coming largely to see that the essential 
problems of efficiency for the years to come are going to be primarily, not 
the problem of handling materials, while those are important and we must 
handle our materials in an effective way, but the essential problems that will 
determine the efficiency of the business man of the future generation, are 
problems that have to do with human relationships; relations to customers, 
relations to competitors, and relations to neighbors, relations to business 
associates, and finally relations to the state. It is not necessary for me to 
go on and state and there is not time to go into the ramifications of these 
various kinds, the kinds of human relationships, but you can see that we are 
right up against that problem at the present time. 

What are to be the various kinds of relationships that will be developed 
here in connection with this specific problem that we have before us, of 
carrying on this war efficiently? I am just going to stop for a moment upon 
this one, namely, the relationship to the state. That is where we have made 
the most conspicuous failure up to the present time in our business organ- 
ization in this country. Some of us who are interested in this problem from 

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Western Efficiency Society Conference 



the standpoint of university education have looked forward with a good deal 
of impatience to the slow and tedious process of solving this problem in an 
effective way, through the education of the future generation. It is a mat- 
ter of a good deal of encouragement that alongside of the many hardships 
and great suffering that will come out of this war, that probably we shall 
actually make progress in solving this question of the relationship between 
business and the state, one of the great fundamental relations, more nearly, 
as a result of this war, than we otherwise should have done. 

It has been my thought in studying this question of the regulation of 
business, that we are losing a tremendous amount of energy, due to the lack 
of effective co-operation in normal times, and if we could work out, if we 
could encourage the various trades and organizations to organize into forces 
which are concerning themselves with the problems of their particular line 
of thought, and not only to do that, but to study the relationship of their 
particular work to these problems of regulation, realizing that it is the func- 
tion of the government — always must be the function of the government — 
to set the minimum standards as to what kind of regulation shall be placed 
on their various lines of industries. The details of much of this regulation 
could be worked out by the men who are closest to the business, that once 
they recognized that it was natural that there should be some organic rela- 
tionship between business and the state, and that it was going to be worked 
out for good or for ill, and they would come into court in such a way as to 
convince everyone of their sincerity, so that the people who are interested 
in this problem of regulation would see that they are not trying to "put 
something over" but that they were honestly trying to get the most efficient 
sort of relationship developed, that we should make progress very much 
more rapidly than we had in the past. 

There has been, of course, in the past a tremendous amount of mutual 
suspicion, that has kept the better type of representatives of the government 
from approaching business men on one hand, and has prevented business 
men from approaching in a free and open way the representatives of the 
government on the other. We have simply got to accelerate that process 
of coming together in this junction. The problem cannot be solved in any 
other way. I have been thinking along these lines, and it is a matter of 
gratification that we do seem to have, if all of the chaos which unquestion- 
ably is abroad with respect to these questions, we do seem to have the stage 
setting, getting ready for some sort of a crystallization of these various ac- 
tivities and organizations for a work, an articulation, in a way that I do not 
think would have happened within a generation, had we not been faced 
with this problem of management, as distinguished from the purely indi- 
vidual or corporate sense. That means, of course, that we have got to w r ork 
out co-operation. We are going to work out co-operation on a much larger 
scale than we have in the past. 

That leads me to the third thing. It seems to me that the universities 
are well equipped to deal with training the minds of the individuals who are 
going out into the business field, that is, to turn these men out with a real- 
ization that the age in which they will do their work, the fifteen or twenty- 

62 



The Importance of the Human Factor in Industrial Preparedness 

five years ahead, are likely to be different, very different, from the fifteen 
or twenty-five years which lie behind. They will recognize that society and 
business and all the institutions of society are dynamic institutions. They 
are working - out new types of organization, they are working out new rela- 
tionships between individuals, working towards new ends, towards ends in 
which every person is effective. I must be ready to get away from a stand- 
pat attitude with respect to any and all sorts of human institutions, I must 
be ready to recognize the fact that a thing that has been in the past does 
not in itself, unless it continues to justify itself by its work, furnish an 
excuse why it should be in the future. So that as I say, the problem of the 
universities is to develop in the minds of their students a sense that they 
are members of the commonwealth, and they have through their traditions, 
through their organizations, through the viewpoint of the men who are 
teachers in the institutions, they have the equipment to develop in the minds 
of the students these three, to my mind, very fundamental attributes of the 
successful executive, the successful dealer in business ; namely, an apprecia- 
tion of the applicability of scientific methods in business, an appreciation 
of the importance of human relations in business, and finally an apprecia- 
tion of the fact that we are living in institutions which must be seen in his- 
torical perspective, which are dynamic from moving and changing all the 
while, and if we expect to do our work effectively we must move and change 
with them ; that as I see it in a nutshell is what the university can do. I do 
not think that the great task of the university is to develop technique in 
particular individual lines. I think it must introduce enough of the business 
detail so that the student will know what he is talking about when he is ap- 
plying- scientific method to these various kinds of business data, but pri- 
marily the mastery of technique in the individual branches of his field will 
have to come after he gets out in business to a very large extent. It would 
be too expensive of time and energy for all instructors in the university to 
undertake to master the detail in very many fields, but he will have an ap- 
preciation of the importance of technique to the successful operation of his, 
particular line. 

A few years ago a man came into my office to talk with me about his 
son. His son had started into the agricultural course in the University of 
Wisconsin, and the boy decided and father decided that agriculture was not 
what he wanted, and he wanted to talk with me about entering the School 
of Commerce, and he wanted to know from me first, he wanted me to just- 
ify our effort to train men for business, and I told him more or less of what 
I have said here. Then I said that it seemed to me that we should begin 
with a pretty general viewpoint in a student's education, and we should keep 
working up more and more in intensive work until finally his study would 
culminate in a very intense analysis of some particular problem. He should 

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Western Efficiency Society Conference 



go to the bottom of it, get his results, find it and see what all of its rela- 
tions were, and he should bring those results forth in the form of readable 
English which an intelligent layman could understand and which a repu- 
table journal might be willing to publish. "Now," he said "how are you 
going to do that?" He said, "I want my son to go into my own business." 
"What is your business?" He said, "I am in the gold leaf business. You 
couldn't supervise any study my son might make about the gold leaf busi- 
ness, because you don't know anything about the business." "But," I said, 
"at the same time it seems to me that a scientifically trained man might 
ask intelligent questions and direct a student to intelligent lines of inquiry 
with respect to the gold leaf business, even though he wasn't a master of the 
gold leaf business himself." Now, it seems to me that illustrates — that is a 
justification for the university to take this kind of work. We do not have 
to be a master of the details in a particular subject in order to point the way 
towards a fundamental, scientific analysis. If that were true, the industrial 
engineers, every time they went on a new job, would be disqualified if they 
hadn't happened to do anything with that line of business before. 

When we come to a functional view of business we see, of course, that 
is not true. Another objection has sometimes been raised. I remember the 
president of The Chicago Association of Commerce, not the present presi- 
dent, but a former president, who was in my office one day, said, "The whole 
trouble is that when you get your man trained to go into the mercantile 
business he will get a fair job after he has made his intensive study in the 
railroad business, and it will all be thrown away." Of course, that isn't 
true at all. It will not all be thrown away. If a man makes a very careful 
scientific study of a problem in the railroad business that, no doubt, is the 
very best preparation for studying some other problem in the railroad busi- 
ness, or going more deeply into that particular problem. But if perchance 
that particular man who had made that study in the railroad business should 
go into some other line of business, he would be very much better equipped 
to approach the problem from a scientific point of view than if he had never 
made any study at all. Even though we cannot decide, as has been at- 
tempted in some states and some countries, just what line of business he is 
going to pursue after he gets through with his training, at the time he be- 
gins the training, yet the university can if they stick to these fundamental 
lines of development and make those the emphatic part of their purpose. I 
do think universities can and are contributing very materially to the train- 
ing for the generation. I think that they are contributing also in the field 
of research, to the development of fundamental principles of business or- 
ganization. In both these lines, training the men that are actually going 
out in business and developing lines of business research, the universities 
have during the past ten years made a tremendous contribution to the effi- 
ciency in business and pointed the way to developments of efficiency in 
years to come. (Applause.) 

THE CHAIRMAN: We will now hear from Mr. J. W. Dietz, who is 
the manager of the Educational Department, Western Electric Company, 
Hawthorne, Illinois 

64 



The Importance of the Human Factor in Industrial Preparedness 



"WHAT INDUSTRY CAN DO FOR ITSELF" 
Mr. J. W. Dietz. 

Mr. Chairman, Friends : My story is a short one. You will find it out- 
lined on the sheet that was on your chair. Will you hurriedly run through 
that, as the hour is getting late? Mr. Porter has already told you of the 
prevalent attitude of industry toward the problem of the schools' job. I 
would like to get just as nearly an efficient employee as possible, and put 
him to work. Dean Hotchkiss has already told us that that is not the job 
of a public school or the educational institution or any grade in the school. 
Their job is primarily the training of citizens, citizens who are able to earn 
a good living and earn it fairly. Some employees have taken the attitude that 
it was the other fellow's job to do the training, and when they needed the 
trained man, to go out and buy him, or steal him from the other fellow. That 
works both ways, they steal him back, so where are you? That brings us face 
to face with the fact that it is our own problem, we have to do it for ourselves. 
Other folks are training people for business, it is industry's job to train them 
in business. You can't transplant atmosphere. We have already heard that 
it isn't the job of any grade of educational institution to try to teach specific 
facts. We want people who are grounded in fundamentals and who can 
readily adapt themselves to all problems, including many of the problems of 
human relationship in business; whether they be of health or safety, or the 
attitude toward the government or community, we find fundamentally that 
education is the salvation. It is education that has for its ideal a progressive 
one, not the old fashioned idea that when you finished school you were edu- 
cated, but it is the progressive ideal of education that demands that every 
situation be met that arises, and as much foresight be used as possible in 
anticipating those needs. Perhaps one of the best ways to show what in- 
dustry can do is to cite some examples of its being done. 

I have chosen a wide variety of illustrations from varying industries 
because we are inclined in business to say, "That won't work with us, you 
know. Our business is different." If we can trace through some of these 
fundamental things which can be adapted and used in each of our busi- 
nesses, perhaps we will make some progress. Educational problems may 
be mastered, broadly, under four main headings, as you Will note here. 
Teaching particular tasks. A by-product of that training will be some 
executives. Your office boy today, if he is properly coached, rather than 
broken in, will perhaps be one of your department heads, one of your man- 
agers, one of your leading executives, in the years to come. You must 
start with teaching office boys their particular job, just as you would start 
to teach the machine operator the right way to do the job before you ex- 
pect him to get up speed on the work. We find here plans which provide 
for a short preliminary training period or rather training periods. In other 
words an office boy will be under the supervision of a trained organization, 
for, say, two weeks. He gets acquainted with the location of the office, he 
learns to know the boys, he finds out what is being done in different parts 
of the organization, a very natural sort of thing to teach him. He is taught 

65 



The Importance of the Human Factor in Industrial Preparedness 

the fundamental things he needs to know like sorting and filing papers, 
doing - odd jobs around the office well. As he grows he works naturally into 
the job of the junior clerk, or if he is more mechanically turned, he will be 
directed into some line which is more along- his natural bent. 

Such plans are usually measured in weeks. What I mean by that is the 
preliminary plans. The development of these people must be followed con- 
tinuously. The teaching of a trade for skilled employees or the all-round 
good man which is so scarce these days is a longer job. There is a great 
deal of difference in letting a youngster learn and trying to teach him, and 
trying the old style of plan which is practically obsolete or abandoned, of 
letting a boy learn a trade under the so-called watchful eye of the journey- 
man who had a lot of his own troubles, being replaced by plans which are 
just as different from those plans as a tractor is these days from the old 
crooked stick used for plowing. The difference is plainly one of supervision, 
making it somebody's definite job to block out the plans, seeing that they 
are lived up to and seeing that the plans fit the boys. 

In the railroad industries we find instructors for about twelve to twenty* 
five boys, coaching the work of the boys wherever they may be in the big 
shops. The Santa Fe Railroad, for instance, has thirty-seven of such shops 
throughout its system, where they take the boys from Kansas and Iowa, and 
along their line train those boys into skilled all-round mechanics. The 
Pennsylvania Railroad has some eleven such shops in its system. The 
Southern Pacific has thirteen. 

There is still another plan which is being developed in some industries, 
that of a separate instruction shop. In other words, having a typical ma- 
chine equipment in some one central location, under the supervision of 
instructors, where your new people are brought in and broken in on each 
new type of machine. In other words, if you are breaking in a boy on a 
billing machine, punch press, or something of that sort, he is brought in 
there and under the guidance of an instructor taught how to do the job. As 
he becomes proficient he has laid the foundation on that type of machine. 
Under this plan he is first learning in the instruction shop and then going 
out and applying under shop conditions in the big shop what he has learned 
in the instruction shop. Later, if he needs to know the workings of another 
type of machine, he comes back to the instruction shop for a couple of 
months, does productive work, slower, of course, than the expert journey- 
man, gets instruction in training, and then goes out and uses it. So he is 
alternating back and forth through his four years of apprenticeship work. 

A common feature in both of those plans is the school job where tech- 
nical instruction is given on company time and on, say, ordinarily, four 
hours a week. The boys realize they are getting the real things, because 
they are problems that they are dealing with every day. Then comes the 
still broader problem, that of teaching a business as a whole. It is impor- 
tant that potential executives shall receive their training in those schools 
of commerce. It is important that you younger men who have broken 
through the lines in these other plans be given a broader point of view about 
the business, knowledge of its products, its markets, and a broader acquaint- 

67 



Western Efficiency Society Conference 



ance with the men in your organization. It is to a very large extent just 
the kind of experience that those men are getting. Education, after all, 
is simply the choosing of experiences, and so industry has a splendid op- 
portunity to use its every-day tools in broadening the future generation. 

Here again we find combinations of plans somewhat similar to those for 
teaching a trade. We find many companies such as the Commonwealth 
Edison Company here in Chicago, the New York Edison Company, our own 
company, the American Steel & Wire Company, having definite plans for 
college men to come into their work, where they are given practically full 
time to absorb and understand and investigate the work of the company 
before they are asked to do productive work, laying a broad foundation in a 
business as a whole. 

A further type of training is that of co-operation with employes through 
voluntary education. Many interesting plans have been developed along 
this line. Some companies have made it possible for the employes to get 
together in groups, taking up particular problems within the plant or in the 
office, meeting on company time and discussing things which were of inter- 
est and importance to the men. Other companies have gone "halvers," so 
to speak, with the men, furnishing all the facilities and helping finance the 
plans, and the employes doing such volunteer work on their own time. Some 
others have co-operated with their employes to the extent of either paying 
the tuition fees in full, after completion of courses at such institutions as 
the Northwestern or New York Universities, or taking the work such as is 
given along engineering lines. It seems to me these are all splendid move- 
ments. They are encouraging, bcause they are making for democracy in 
industry,' and for the opening of opportunities for all who have the capacity 
and the willingness and the grit to undertake them and profit by them. 

You can start tomorrow in your business. After all, this is a problem 
of doing in a better way just what we have been trying to do for years. 
You have people in your own organization, you have the viewpoint that is 
necessary to start this sort of work. Make it a man's job. Give him time 
to do it. Let him study the job. Give him supervision of your plan. Back 
it up by the authority of the high officials in your organization. Give him 
an advisory committee or council for guidance and breadth of view, but get 
it started. Get the plans down in black and white, then you have some- 
thing to work to. Get your results down in black and white, then you have 
some way to find out your failures as well as your successes. 

One fundamental certainly is that instruction and production in all 
these plans have been divorced. In other words, instruction must come first, 
then production later. That seems to be one of the keynote problems in 
getting this sort of work properly started in any industry. You know under 
the stress of present conditions, how all of us are being pounded to get out 
this, that, or the other part of our regular work. Make it somebody's job 
to develop employes within your business, and hold them just as account- 
able for results as you are holding the other fellow for production. It is 
very difficult to put both those responsibilities on the same man's shoulders. 

This will naturally lead us to take an inventory of the talent within our 

68 



The Importance of the Human Factor in Industrial Preparedness 



organization. Your organization is studying where it can substitute this 
material for that, a less expensive kind for this, or which is more expensive? 
Or, perhaps, more of a kind of material which will do a better job, which 
will be cheaper in the long run. Are you, as business men, using grammar 
school boys where you should be using high school graduates? Are you 
putting college men on jobs which are high school jobs? Are you putting 
high school boys on jobs which should be undertaken by technically trained 
men? Take an inventory of your talent. It is not a far cry — perhaps it is 
somewhat distant, but let us hope that the time is coming when industry 
itself will have plans so well organized within itself that every new em- 
ploye who comes in, whether he is coming to an office from his grammar 
school education, his high school or college work, or whether he is coming 
to you from another business, will find a definite, well meaning plan which 
will help him get started right in the new business, and not until we have 
such a system will we be as efficient and as successful as we deserve to be. 

Any successful plan carries with it the obligation to recognize increased 
value to an organization. That hardly needs further enlargement. We 
must come to the point where employes will get together in such organiza- 
tions as this, and in such organizations as the National Association of Cor- 
poration Schools, .which is a group of employers studying this particular 
problem of developing people within their own business. It makes a natural 
point of contact with such men as our friend, the Dean, here ; it makes an 
understanding point of contact between the business executives and the edu- 
cational institution ; it makes efficient overlapping, but not duplication, in 
the development of people. 

Enlightened self-interest on the part of employes demands this short of 
progress. It is a duty you owe to your employe. If the training of citizens 
is the public educational problem, the training of employes is that of industry 
itself; but Ave believe in industry that we can, too, render a service to our 
nation, because we believe the better the employe the better the citizen. 
(Applause.) 

CHAIRMAN PORTER: I hope all of you who can will stay to hear 
the last speaker on the program, after which we hope to have a few mo- 
ments of discussion, not a discussion, exactly, but if any of you desire to 
ask questions, I am sure the speakers whom you have heard will be glad to 
answer them. 

The last speaker, another man speaking for industry, is Mr. E. W. 
Puckett, the president of the Fort Wayne Oil & Supply Company, Fort 
W^ayne, Ind., another company who has seen the light and who has done 
pioneer work along educational lines. 

Mr. Puckett. (Applause.) 

69 



Western Efficiency Society Conference 



"TRAINING THE COMING GENERATION OF WORKERS 
AND EXECUTIVES." 

Mr. E. W. Puckett. 

Mr. Chairman and Ladies and Gentlemen : I know just how you feel. 
After you have had a hearty meal you are liable to have acute indigestion if 
you take any more. It is quite late and I am not going to say very much. 
In the first place I am just a little out of place. In looking down this row 
of gentlemen here, as speakers, listening to Mr. Emerson and the two gentle- 
men that followed him, and their remarks, I feel just like I am out of place, 
and I want tell you why. My work is so different. I was unfortunate when 
I was a boy, and the college education that they refer to was not my lot. I 
was unfortunate in not being able to get a college education. I have come 
along through the line from hard knocks. There is not a man in this room 
that has started as low financally as I, or any lower — not possible to start any 
lower. But w r hat happened to me I have passed along the line for about ten 
years, to boys more than audiences like this, of just what happened to me and 
what saved me in a business way. 

As I say, I was unfortunate without a college education, but I had the 
privilege of attending a business college, a night school, and I finally had to 
give that up because I was the support of an invalid father, a lone mother, — 
and I had to give that work up to go out and earn more money. Just before 
I left that business college a number of years ago — many years ago it was, 
because I am too old to go to war — the professor of the business college said 
to me, "I would like to know why you are leaving." I told him why. He 
said, "When are you going to leave?" And I said, "On Saturday." On 
Saturday morning he called me into his office, and said, "Puckett, you are 
going into a cold world," as he knew, without an education, that is, not even 
a high school education. "Before you go," he said, "I have noticed your 
work here in our night school, and I want to give you just a few pointers," 
and he gave them to me, and, as it were, I wrote them on my cuff, implanted 
them in my brain, have used them ever since, and have repeated them over 
five hundred times to high school boys, Y. M. C. A.'s, and organizations of 
that character. 

To me it is a pleasure to tell boys just what I have found out in taking 
the things that the professor said to me and applying them to my own life, 
and as I became an employer, of analyzing the boys, analyzing the men, 
analyzing the people with whom I came in contact. It is a pleasure to me to 
tell a boy, just in the rude way that I can, just as sure as those lights 
shine, to tell him twelve things that no matter if he has a college education, 
no matter if he has not had a college education, he can better himself in life 
if he makes a study of those twelve things. To me they have been a busi- 
ness bible. And this training, it seems to me, compared to the work of the 
previous speakers it is simply kindergarten, but my. life has been built along 
kindergarten lines. I say to the boys and the girls, "My work has been more 
along the line of selling, salesmanship, or what makes for success. Now., 

70 



The Importance of the Human Factor in Industrial Preparedness 



briefly I am going to give you those subjects and I only wish I had the time, 
for the benefit of the few young fellows I see in this audience, I wish I had 
the time to go into it in detail and tell you the good things that come from 
the application of these subjects. These subjects, ten of them, are the sub- 
jects that he gave me almost thirty-five years ago. Just think of it! Thirty- 
five years ago, and they are things that you read today in the modern busi- 
ness magazine. 

The professor said to me, "Puckett, when you go out in the world, the 
first thing that you want to look out for is your health. Take care of your 
health. The next one is personality. The next one is character, the value of 
character." Every boy in the country should read Dr. Marden's book on 
character. The next one is initiative, the next one justice, the next one tact, 
the next one memory, the next one concentration, the next one co-operation, 
loyalty, and the foundation of enthusiasm. 

I can see the value of a college education, I am only sorry every day 
that I haven't got it. I can see how I could use it, but the boy that is com- 
petent without the college education is bound to rise like cream, to the ex- 
ecutive, if he takes those subjects and studies them, reads up on them, and 
applies them to his everyday life. That is my recreation, it is to tell boys 
about these subjects. As I say, I only wish I had the time to tell the young 
fellows how I apply them every day in my business. They are wonderful 
subjects if you apply them to your life. 

It is getting late and I would like to talk for an hour on these subjects, 
but I know you are tired and restless, and I am going to bid you good-night, 
with the hope that some time I may be able to have the time to talk more 
about them. I thank you. (Very great applause.) 

THE CHAIRMAN: Ladies and gentlemen, I understand Mr. Puckett 
— this is of particular interest to the members of the Western Efficiency So- 
ciety — has consented to appear before one of the early meetings and go 
more in detail along the interesting line he has just touched on tonight. I 
am sure we want to hear him. It is after all the man coming up through 
the school of hard knocks, who has learned the lessons of self-reliance, who 
can inspire us most. Our President has some announcement, I believe, that 
he wishes to make. 

PRESIDENT KESSLER: Owing to the lateness of the hour there 
will be no general discussion. I want to call particular attention to the fact 
that tomorrow morning the round table discussion will be held at ten o'clock 
in this room. The round table is a free for all discussion. We want as 
many as possible to be present from ten to twelve tomorrow morning. 

Immediately after the close of this meeting the Exhibits Room will be 
open for thirty minutes. Answering a question that has been asked several 
times by visitors and guests, the regular meetings of the Western Efficiency 
Society are held in this building on the second and fourth Fridays of each 
month. 

The meeting is adjourned. 

(The meeting was adjourned to meet Thursday morning, May 24, 1917, 
at ten o'clock.) 

71 



THIRD SESSION 

Thursday Morning, May 24, 1917. 



ROUND TABLE DISCUSSION ON "INFLUENCING THE 

MANAGEMENT" 
W. S. Ford, Chairman 

The meeting was called to order at 10 A. M. 

MR. A. B. SEGUR, Chairman of Round Table Committee: The 100th 
meeting- of the Western Efficiency Society has shown a number of develop- 
ments in the efficiency movement. Among those developments there is the 
realization on the part of efficiency men generally that there is no one man 
or group of men who hold all the information that is to be had on efficiency 
projects or on efficiency work. Some of the best ideas in the efficiency 
movement are to found not in the laree organization but in many cases in 
the small organization. The men in the large organizations cannot get the 
benefit of these ideas unless there is some way of bringing these people to- 
gether and having the various discussions published. That is very largely 
the object of having the round table. Another thing that we have realized 
is that the number of people interested in the efficiency movement is rapidly 
increasing. Five or six years ag"0 the movement was more or less unpopular. 
I know in our organization, which is fairlv large, that the first vear that I 
was there the efficiency bureau men were unponular. Now we talk with the 
heads of departments and the things that we thoug-ht were follv to mention 
five years ago, the department heads themselves are bring-in?- ud and are 
urging action on, because it is a matter that has to do with fundamental 
principles. The movement must grow. The war is on now and we are up 
ag-ainst, as Mr. Knoeppel said yesterday, the greatest aggregation of organ- 
ized brains that the world has ever seen. Unless we eet together as effi- 
ciency men, get together in a mutual understanding of these problems, we 
can't hope to successfully meet that ag-greeation of brains. If we can get 
together and have a proper understanding- of who is who and whv, if we can 
know what everv man has done and p*et the benefit for the whole bodv of the 
individual thought, then and then onlv can we hone to make the most of the 
efficiencv movement. I am pleased to introduce the Chairman of this meet- 
ing*, Mr. W. S. Ford, who is a member of the Board of Directors and the 
man who has been very larg-elv responsible for collecting- this mtere.stine 
and instructive exhibit of charts, etc., in the adjoining room. I will call on 
Mr. Ford to take the chair. 

MR. W. S. FORD: Ladies and Gentlemen. I believe the duty of a 
chairman of a round table is to efface himself as much as possible. The 

73 



Western Efficiency Society Conference 



round table is what every man makes it. We are going to make this strictly 
informal. The only ruling that the Chair will make will be to ask you to 
kindly announce your name, in order that it may be properly recorded. I 
shall not at first set any definite time limit on your talks. The group is 
small enough so that we can let you talk out what you have to say. I am 
going to call on Mr. Stanley A. Dennis, who is representing the A. W. Shaw 
Company, in the absence of Mr. Leon I. Thomas. 

MR. STANLEY A. DENNIS: Mr. Thomas, the managing editor of 
Factory Magazine, was on the program, but was unable to be here ; he had 
to go down to Cincinnati to attend a munitions conference, so he asked me 
to read his paper. I am not quite sure whether this paper that Mr. Thomas 
has given me touches the subject that you have in hand before this meeting 
or not, but I know Mr. Thomas endeavored to touch the subject as outlined 
in the program. His paper is entitled "The Place of the Technical Journal 
in Influencing the Management." 

"One of the great dangers that every corporation must guard against is 
the tendency to stop growing, that is, to cultivate what I have sometimes 
called the inertia of habit, to be satisfied to do things the way they have been 
done." James Logan, General Manager of the United States Envelope Com- 
pany, used these words in a letter to me in which he describes a unique plan 
— a plan in which I think you will be interested. He goes on, "As a back 
fire against that tendency (of inertia) I suggested to our superintendents 
and assistant superintendents that they should use at least one day each 
month visiting one of our divisions in order to see how their work was being 
done, or to visit some other industrial plant perhaps in no way connected 
with our industry. 

"This was done with this thought in mind — that with the day off spent 
in a different atmosphere from that in which they lived most of their wak- 
ing hours, they would come back to their work having had their minds fer 1 
tilized by contact with other minds, and seeing what other men were doing 
they would be more open minded with regard to improvements with their 
own methods. 

"After each visit a report is made to the manager of the division noting 
what they have seen. This is good discipline for some, for without the 
thought of making that report they would have a pleasant visit but bring 
back nothing and would have seen very little, but knowing they must make 
a report they try to note something worth reporting. 

"A copy of each report is sent to the general manager and is then edited 
more or less by cutting out the obvious or that which has perhaps been 
already reported on by another. 

"Two copies of each report are then sent to each division, one for the 
manager, another for the superintendent. (These are placed in desk files 
kept for this purpose) and they are supposed to not any suggestions which 
may have been made. 

"They are also supposed to review these reports from time to time, for 
by so doing they will take up suggestions which when made did not strike 
them as having much value but something may have happened which now 
makes the suggestion seem more worth while, 

74 



The Importance of the Human Factor in Industrial Preparedness 

"The paragraphs in each report are numbered and reports are consecu- 
tively paged so that reference may be more easily made to any particular 
point to which it is desired to draw attention later. 

"Now what about the value of these visits? That is very largely de- 
pendent on the human equation — some men see a great deal — others see very 
little and those who see the least are the ones who need most the help to be 
gotten from seeing, but I believe it is inside the truth to say that every 
visit made is worth while. Our men become better acquainted and our 
'industrial family' spirit is strengthened and it cultivates the disposition to 
help one another." 

Mr. Logan may not realize it but he is an editor. He is editing a fac- 
tory management magazine and further he is influencing his own manage- 
ment organization with it. And the influence which Mr. Logan is wielding 
with his little mimeographed loose-leafed magazine is a double edged 
sword. The readers (who are also contributors) are influenced by getting 
the benefits of a dozen inspection trips besides the one they reported on. 
(And, by the way, I know that this plan of Mr. Logan's is not merely a good 
idea gone to seed. It is in full bloom and likely to stay so. I have seen this 
well-thumbed book of reports — this magazine, if you please — in one of Mr. 
Logan's factories and have been told by the superintendent of specific sug- 
gestions that have been put into practice in that plant as a result.) 

On the other hand, the contributors (who are also readers) become 
keener observers of the good and the bad in management because of the 
training that comes from setting down in report form the transferable man- 
agement ideas and plans gathered in plants visited. 

I am a firm believer in the value of putting this extra edge onto the in- 
fluence of the technical journal. I mean that readers ought to contribute 
more freely to its columns. A management magazine ought to be written 
by its readers, I believe. True, this makes a lot of work for the editor, but 
that's not your worry. I haven't much sympathy with the magazine edi- 
torial note on the title page, reading "manuscripts must be typewritten and 
on one side of the sheet only, etc." I would rather get an experience-tested 
idea from a factory executive written in a hundred words in long hand on the 
back of an evelope, perhaps while on a train journey, than a fifteen-page 
manuscript neatly typed on the finest bond but containing not a kernel of 
an idea-. 

Influence upon readers grows when other readers tell in a technical 
journal of their common problems and their solutions. 

An editor meets difficulties when he tries to get this sort of material 
for his paper. Brushing aside the "haven't-the-time-to-put-into-it" excuse, 
the main reason for refusing to allow magazine use of a management plan 
may surprise and interest you. It is this, "We don't feel that this plan has 
been in practice long* enough yet to get all the faults out of it. We shall 
be glad to let you tell the story when we get the thing working perfectly." 
As you know, that time never comes. If the management is alive it can 
always find ways to better every plan it has. 

I lay no claim to having discovered this tendency to hold a thing back 

75 



Western Efficiency Society Conference 



until it is perfected. I am merely echoing what has been said by others not 
in any way connected with technical journalism, but I do know from experi- 
ence the retarding influence that this is on the development of the best in 
management. As one high executive in a Cleveland concern put it, "And 
the best things are never absolutely perfected. So, by this reasoning, much 
is lost to all." 

If you will think it over I believe your own experience with recently 
graduated technical men will back me up when I say that this tendency to 
believe that there is no value in a thing unless it is 100% correct is more 
pronounced in the engineering type of man, particularly in the engineer who 
has not been long separated from right and wrong (zero or 100%) answers 
to college questions. It wears off with greater contact with the ways of 
the business world's gradual development. 

Probably the sales type of executive overestimates to the same degree 
that an engineer underestimates the value of a workable plan. 

The technical journal has a distinct advantage over some other agen- 
cies in influencing the manager. For instance, it has an entre to him when 
he has his slippers on in the evening at home. There, no Browns or Jones 
interrupt him with troublesome details about this shipment or that material 
shortage. His mind is detached enough from office surroundings to see, un- 
distorted, the value of an idea in its relation to the other factors in a case. 

But there are disadvantages, too, in the technical journal as a means of 
influencing the management. In four words, "People dislike to read." The 
most powerful printed argument has no influence on the manager if he 
doesn't read it. There are ways to offset this objection. That's part of the 
editor's job and you will not be interested in the detail, but needless to say, 
a readable title expressed in good typography, a clean page, well illustrated, 
well printed on good paper, help. 

A journal written not at readers but to and by readers out of everyday 
experience stands a good chance to have a strong influence upon its readers 
who in the present discussion are those making up the management. Such 
magazines can bring to an executive the experience of others whereas he 
would not take the time to visit other plants even if he knew where to find 
the ones with the same problem he is facing. 

Furthermore, where a magazine covers more than a single line of in- 
dustry it brings him the experience on a common managerial problem from 
plants quite outside his line— plants that it would never occur to him to 
visit. Under such conditions each issue becomes a set of reports upon some 
common function of management. 

Being a reader of such a magazine has a parallel in attending a conven- 
tion, so far as beneficial results go. It differs in that it is "held" once a 
week or month. Everybyody can hear. There are no railroad fares, no 
smoky conference rooms (unless you prefer them to be) and no set hour for 
the meetings. 

But to get the best influence from either don't merely register — enter 
your subscription — and then think your duty is done. Show up promptly 

76 



The Importance of the Human Factor in Industrial Preparedness 

at the meetings and listen — take the magazine out of the wrapper promptly 
when it arrives and read it. 

THE CHAIRMAN : Gentlemen, how many of you have had experience 
in passing magazines around the shop for your men to read and observing 
results? Has any one here tried that out? Before we go on, are there any 
comments on that point? 

MR. DUTTON : The Pullman Company has tried that in a small way, 
and is trying to do it to a little greater extent with some of the magazines 
and I know the results have been quite satisfactory on the whole. Some of 
the men take the magazines and don't read them, but keep them a long 
while, and, of course, there are difficulties. Others take the magazines 
but don't seem to read them and return them. I think it is a very good 
plan in this way to require the men to check the reading of the magazines, 
and possibly in some cases to go a little further and make a brief report on 
the ideas. I think the average shop men are in very great need of that sort 
of work, of getting around and reading periodicals. They do not read very 
much. If we can get them to actually read things, as we ordinarily do, and 
circulate them with the request to check, it seems we should get good re- 
sults. 

THE CHAIRMAN: It is an excellent. plan to send the magazines out 
into the shop, but what has been the experience of you men? 

MR. L. W. WALLACE : I have had no actual experience myself, but 
I know the New England Butt Company, Providence, R. I., has a reading 
box into which they put technical magazines and factory publications and 
current periodicals of all kinds, and give their workmen the opportunity of 
taking those at their pleasure and not bringing them back, if necessary. The 
difficulty with the New England Butt Company is to keep magazines and 
reading materials in that box. The men take them out, take them home, 
and the presumption is that they are read and they appreciate it very much. 
I know that that is also being tried in another factory on a small scale at 
Indianapolis. Over there the last week the person in charge said that those 
magazines are going out rapidly. From some investigations and talks with 
people who have tried these things, I am quite confident that it will work if 
you give them the proper encouragement. 

MR. W. A. .GRIEVES: We have one of our engineers who has it as a 
part of his duty every day, if a magazine comes in, to glance over each maga- 
zine, mark the articles and then draw the attention of the particular person 
in that organization that would be interested in a certain article. That is a 
part of his work. We have found that immensely profitable. Because of 
the large number of magazines it is so easy to overlook some of the very 
best articles that are published. The average person does not have time to 
look through all the magazines, but by having our attention drawn to some 
particular article, matters are greatly facilitated. We have found it so. 

THE CHAIRMAN : I had an experience not long ago while up in the 
tool room. I picked up the American Machinist, and found an idea that I 
had been looking for for a long time. It was only by accident that I found 
the article. Has anyone else had a similar experience? What is the money 

77 



Western Efficiency Society Conference 



return from getting those ideas out to the men? Can anyone trace any 
direct money return except from the enthusiasm that is created? 

MR. DENNIS: I take it that a number of the men here must know of 
the little scheme that "Factory" has worked out for the distribution of the" 
magazine in the shop. How many of you men know about that? Let me 
see your hands. Then it is pretty well known. I might say that that little 
slip across the bottom of the front cover, or inside, for the insertion of names 
and the route of magazines from factory executive to factory executive, or 
from manager to superintendent and so on has panned out very well. We 
have in our office quite a number of letters, indicating the very definite value 
of that little scheme. I might say this, that it would be the simplest thing 
in the world for you to have your printer set up in type on a little slip of 
paper that same form used in "Factory," and just glue it to any other maga- 
zine and circulate it in the same way. We are perfectly willing to have other 
magazines circulate as well as "Factory," so if you will just adopt the same 
idea they will all be circulated. They will all be circulated a little bit better 
if you have a check up or follow up system, to make sure that the magazine 
does not die in the hands of one man and fail to reach the next one. 

THE CHAIRMAN : I, personally, am certainly sold on the magazine 
idea. Mr. Stephen A. Gilman, of the University of Wisconsin, is here. We 
would like to hear from you, Mr. Gilman. Perhaps you will be willing to 
talk to us on technical training for business. 

MR. S. W. GILMAN : Mr. Chairman, I had no idea whatever of being 
called upon this morning. I came to Chicago unexpectedly, and expected to 
spend the day here, a few minutes in this room and the balance of the time 
in connection with the Quartermaster's Department. Of course, I would 
not fail to appear before a body of this kind, under any circumstances, even 
though unprepared on the subject in which you are specially interested. My 
experience in the City of Chicago for twenty years in technical business, 
largely in manufacturing, coal mining and railroading lines, was followed and 
has been followed for a number of years by an educational experience in the 
University of Wisconsin, starting into that institution about the time that 
there arose among the universities of the country an ambition to partici- 
pate in technical education. The University of Wisconsin seventeen years 
ago entered the field of tchnical education for business. At that time I w r as 
among a great number of business men who had absolutely no use for col- 
lege educated business men. If I could find any one to enter our organiza- 
tion who had not had a college education, he was preferred, very much pre- 
ferred, to one who had. That was before the days of the plan for education 
for business. I believe it is true that eight or nine of the great universities 
of the country have seen the opportunity to participate in the preparation of 
young men for business. I believe that they have, after many years of very 
costly experimentation, exceedingly costly, making all kinds of mistakes, 
have come to the right idea of mingling in with the cultural education the 
preparation or the academic degree and the 'liberal arts courses, mingling in 
strong vocational work. Taking these young men into the great business 
organiaztions, bringing them to Chicago, taking- them to Dayton, taking 
them to the great manufacturing plants of the United States and letting that 

78 



The Importance of the Human Factor in Industrial Preparedness 

dovetail in with their corporate finance, cost accounting, business organiza- 
tion and management, industrial management, scientific management, and 
seeing the best minds and meeting the best people. Above all, it seems to 
me that our strongest work has been done in getting a group of impres- 
sionable young people to face great personalities in business. We have had 
the good fortune to have a dozen or fifteen, sometimes twenty in a year, of 
the great manufacturers of the country appear before the students, men of 
great renown, men of great personal capacity and influence, who come before 
our young people and who have helped to establish standards, standards of 
personal efficiency, standards of manufacturing, efficiency standards of per- 
sonal conduct, if you please, and a well rounded equipment for the affairs of 
life. We have found it a great help to us to bring men like Samuel Insull 
of the Commonwealth Edison Company, to bring men in from Milwaukee, 
the great organizers of that city, and of Chicago and of New York and of 
Cleveland to appear before these young people and impress upon them the 
absolute necessity of a strong, fundamental preparation in political economy, 
in political science, in accounting, in business law, in the sort of thing that 
gives a taste for research, for investigation and for strong study along the 
lines in which you are interested. 

Now I am particularly skilled in the things in which you 
are interested this morning. I am interested in all things that 
concern your society, and I am an admirer of the Western Effi- 
ciency Society. I count among my personal friends a number who are very 
enthusiastic in the management of your organization; but I say to you that 
we are trying in the University of Wisconsin to equip young people of capac- 
ity, of character and personal ability to help you solve the problems in which 
you are particularly interested. We find that our youngsters will go down, 
for instance, to the great shops of the Chicago, Milwaukee & St. Paul Rail- 
way at West Milwaukee and will spend days, not in the rah-rah attitude of 
the old time college student, by any manner of means, but will stay there from 
eight o'clock in the morning until six o'clock at night, without any lunch, 
simply delving into the problems and getting educated, if you please, in the 
mechanical processes, in the storeroom problems, in the handling of rec- 
lamation of material, in all those things which form such a splendid and 
valuable laboratory for us all. 

I believe in the future of vocational and technical education, 
and I think our Dr. Scott, the director of the course in Commerce 
at the University of Wisconsin, was right seventeen years ago when he 
made the prophecy that there must be if the great institutions of 
learning are to live and extend their influence a recognition that there is a 
profession of business, that we must help to make a strong and splendid 
foundation for the business men of the future. My son in his professional 
or mechanical or manufacturing business today has not at all the problem 
that I had when I entered into business, with the forty different kinds of 
competition, trained into the service and trained to appreciate the great 
group problems, the great problems of commerce that it was not necessary 
for the man entering business forty years ago to have a knowledge of. We 
are with you, and we stand ready to co-operate, to get your counsel and ad- 

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Western Efficiency Society Conference 



vice for all our courses, probably forty-six vocational courses at the Uni- 
versity of Wisconsin, or subdivisions in which we are attempting to inspire, 
to inflame, to enthuse young people not with any little superficial courses, but 
trying to get them into the very heart of big things and get them to appre- 
ciate what the great big corporations want when they are looking forward to 
taking young people and infusing new blood in the business, and it has given 
me a lot of pleasure to appear entirely unprepared as I was for the occasion 
before you and say a word of greeting, and to tell you that I think you are 
a splendid organization and are doing wonderful work. Your magazine is 
doing wonderful work. People talk about it. Your influence is being com- 
mented upon all over the country, even though you may get no direct reac- 
tion from it. I thank you very much. (Applause.) 

MR. CHAIRMAN: Mr. Gilman has very ably expressed the present 
tendency in business. Along that same line I should like to call on Mr. L. 
W. Wallace, of Purdue University, Lafayette, Ind. 

M,R. WALLACE: Mr. Chairman, I am like my friend Gilman. I have 
had no previous warning that I was to be called upon. It seems college pro- 
fessors have the reputation of being able to talk, and when a chairman of a 
meeting wants to kill some time he calls on the college professor. (Laugh- 
ter.) It is like the experience I had some few years ago when I was ex- 
plaining some researches before the Western Railroad Club in carrying out 
experiments with still air. In the discussion of that problem the question 
arose what would happen if the air had been in circulation instead of being 
still. I replied to that question at the time of making that research I kept 
all hot air professors muzzled. It seems to me that the chairman of a meet- 
ing sometimes wants to unmuzzle the hot air professors and call on them as 
he has done this morning. I wish to say that I am very much interested in 
this conference. I am a member of a national organization, the American Soci- 
ety of Mechanical Engineers, that is this week having its spring meeting in 
Cincinnati, a few miles from my home, nearer my home than Chicago, but 
I looked over the programs of the two meetings and I came to the decision 
that this Western Efficiency Society conference was more important at the 
present time; this topic, this outline that we have under consideration is 
more timely than the subjects the American Society of Mechanical Engi- 
neers has under consideration, so I came to Chicago instead of going to 
Cincinnati. 

You know for many years the manufacturers of this country 
have entirely neglected the human factor in management. We have paid a 
great deal of attention to, laid a great deal of stress upon machinery and 
upon the materials, but that other and third element, alliterative letters, as 
you will notice, men, we have neglected a great deal. We have come to the 
point now where that is the very vital issue. Indeed, the man problem is 
now the most vital issue and instead of the making of man power more effi- 
cient, or because of the inefficiency of man power, a great many of our fac- 
tories are facing a serious situation. Indeed, a great many of our organiza- 
tions, if they do not promptly solve this man issue, are going to lose divi- 
dends and they are going to fail to produce the goods and meet their deliv- 
ery promises. Therefore, I am entirely and keenly interested in this prob- 

80 



The Importance of the Human Factor in Industrial Preparedness 

lem. Being a university man and a teacher indicates that, otherwise I would 
not be in the teaching game, although the university professor gets a lucra- 
tive salary, of course. (Laughter.) Primarily, it is the man, it is the inter- 
est in the man problem that keeps men like Professor Gilman and Dr. Scott 
in the teaching game. 

Now a word with reference to technical education, technical train- 
ing. I presume that is what Mr. Ford wants me to talk about. 
Primarily, I wish to say that we have organized a course in industrial man- 
agement in the university school of mechanical engineering. We began in a 
small way five or six years ago. Briefly, we give a course of lectures on 
shop management problems, types of organization, labor problems, labor 
unionism and non-unionism, wage problems, handling of materials, store- 
keeping methods and all of those things that you think of connected with 
the problems that face the executive. In addition thereto we have the idea 
that the future shop executive must know something about heating and 
ventilating his factory. If you keep your workmen comfortable and con- 
tented you will not have such a large labor turnover. So we must these 
days pay some attention to the environment of our workmen. I served an 
apprenticeship in a shop where the environment was unattractive. I looked 
out of the window on a foreboding landscape. The progressive factory man- 
ager realizes today that he must make his surroundings comfortable, pleas- 
ant and appealing to the best taste of his workmen. So we go into the ques- 
tion of heating the factory. We also have the conception that the modern 
factory manager ought to know something about hygiene, sanitation and 
first aid. So we give the men some instruction on these subjects. The 
factory manager ought to know something about lighting. We know that 
today the lighting problem really has a decided influence upon production. 
In some lines of manufacture it is a very decisive factor in the question of 
fatigue, the importance of which all of us now recognize. The modern fac- 
tory manager, the future factory manager must know something about light, 
so we go into the question of factory lighting. So much for the outline of 
the lecture course of study. We have six hours a week devoted to factory 
design. We do not give a hypothetical case or theoretical case ; that is the 
way they used to teach in colleges, but we are not doing it any more. We 
go to the shop, as my friend has referred to, put the men in the shop and 
take up the design problem in that way. 

Briefly, for this year the Monon shops at La Fayette are very crowded 
and obsolete and they need equipment. We went over there and 
made a detailed layout of the factory problem for that shop, located 
all the equipment, got a list of all materials, a list of every 
operation through which each piece went down to the matter of route 
charts for every piece of manufacture and repair of locomotives. On that 
basis we then took templates and made a re-arrangement of the depart- 
ments, rearranging the equipment within the confines of the present shop 
layout. We showed up the defects of the present routing system, showed 
up the defects of the present shop layout. Then they wanted to build. We 
then w( at back through the records for the past five years and found out 
what their growth was, what line of repairs came most frequently, and then 

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Western Efficiency Society Conference 



on the basis of that we anticipated what the growth would be for the next 
ten years, and then made the proposed factory extensions, additional floor 
space. After that we then made a re-arrangement of the plant, the routing 
system and the layout of the equipment in the proposed enlargement and 
put in a heating and lighting system. 

Along technical lines, training in industrial management is one of the 
things being done. It is being done elsewhere somewhat similarly. Per- 
haps the University of the State of Pennsylvania, where they are doing the 
same thing, has. one of the best courses. You will find that the technical 
institutions like Wisconsin, Illinois, Purdue, Penn State, Worcester and 
Dartmouth are keenly alive to this new problem that is confronting the 
factory people of this country. We are delighted to meet the problem from 
our viewpoint by giving these men some insight into the factory problem. 
(Applause.) 

MR. DUTTON : I think the chairman is running a rather grave risk 
on a warm day like this to call on so many college professors. However, I 
would like to add a little bit to what Dean Hotchkiss said last night. I 
think he well put the case for the Northwestern University's conception of 
training in business. Perhaps I can bring out one or two elements. What 
is the problem of educating the technical man, giving the man a technical 
education for business, or in fact for any other line? As we conceive it, it is 
not primarily a question of giving the man this specific training, the spe- 
cific knowledge or particular methods he is going to meet. That is too ex- 
pensive an operation, because when that man gets out he is entirely likely to 
get into a line quite different. In my case I studied electrical engineer- 
ing, and I am now teaching industrial management, two lines which are con- 
nected but by a rather thin thread. So that it is too costly to give a man 
technical training of that kind. As we conceive it, the primary idea of a 
college education is to give him the training in habits of thought, in meth- 
ods, if you will, of working with the mental tools, and such problems as we 
have just had outlined to us here are very excellent examples, as we under- 
stand it, not because the man is going to do those things.^ He may do them, 
but more important than that he will have a definite method established in 
his mind. He will 'learn how to attack such problems. The next problem 
may take up an entirely different line. 

We hold there are three very important things that we have 
to do for the college man. In the first place, we have to give 
him this training in scientific method. In the second place we have 
to give him an understanding of the human element. That is a new prob- 
lem we have just begun to approach. In the third place we have to give 
him enough contact with the practical side to make it real to him. We all 
find it mighty hard to listen to a talker who goes through a talk dealing en- 
tirely with abstractions, dealing in no concrete illustrations. In this con- 
nection I would like to make reference to the work which Mr. Simons of the 
University of Chicago did last year in sending out his men, not only for a 
visit but for rather extensive studies of individual plants. That is really 
pioneer work in the field of industrial management. That is giving a man 
the required contact. There are still some problems to be worked out. It 

82 



The Importance of the Human Factor in Industrial Preparedness 

is a tremendously hard job even in the course of several days' work in a 
factory to get anything like a conception of the real conditions in the fac- 
tory. Really the only way you can get them is to be there several months. 
Our efficiency managers are finding that out. Sometimes they are in a grave 
situation when they are called upon to make a report on very brief notice. 
You have to be in a plant for some time, you have to see and un- 
derstand conditions and see the way things work from day to day. 
You have to become acquainted with personalities before you can really size 
up a situation. It is not an easy thing to let the college man get that at first 
hand, more particularly so because he has no experience. We are all think- 
ing and working in that direction. 

Now I might just in a word describe the courses which we 
have been working on at Northwestern with the idea of teaching, 
method. The average college man learns method in university 
courses. He learns how to generalize, to pick out the kernel in a situation, 
and to find the underlying law, but very frequently he does not realize that 
he has learned it until long afterwards. I know in my own case I very 
nearly went through the whole course in engineering before I realized there 
was a scientific method. I had used it but I didn't know it. I believe it is a 
desirable thing for a man and a very helpful thing for him to understand 
the tools he is working with. So we made an attempt in a means which we 
have euphoniously labeled efficiency standards to teach scientific method. 
In the first place, we are giving a series of lectures on scientific method, the 
use of that thought tool, if you will. In the second place, we are taking a 
single problem. In this case we take a comparison of the relative cost of 
the addressograph and typewriter operations, for a given size of lists and 
number of uses and names and take time studies on the operations to com- 
pare that element and give the cost figures, and have the men work out a 
set of comparisons, in fact, a set of curves making the comparisons general. 
That is only one particular problem. Next year we hope to take another. 
The idea is to take some problem which can be solved in class and to give 
the man an opportunity to use the tools which we discuss in the class. 

Now I want in conclusion to speak of a third element. I have mentioned 
the scientific method, the value of teaching that, I have mentioned the contact 
with practical technique, but I think really the biggest problem which today 
faces not only the college^ professor but the public at large is education in the 
value and the methods of use of the human element. My predecessor has 
made much study of it and it certainly is the unsolved problem of business 
today. We have gone through an era of development of mechanical meth- 
ods, of systems, and we now I think understand pretty well the principles 
that underlie production and control. That was a thing which was chaotic 
a few years ago, but the work of such men as Taylor and Beruth and Emer- 
son and a great many individuals in this field, working in particular plants, 
has brought out the underlying principles so that today we understand, I 
think, in a general way what should be done. There are still thousands of 
plants that know nothing about it, but we have the principles worked out. 
The problem is being solved. Our problems are other than mechanical con- 
trol, problems of finance and problems of accounting. They are still in a 

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Western Efeiciency Society Conference 



state of flux, but we know where we are. We don't know completely where 
we are on this question of handling men. As I study plants and work in 
various plants, I am more and more impressed with the fact that the real- 
ization of what the problem is is very tremendous. 

Now there are several elements which are necessary in controlling- 
men. In the first place, we naturally have to have the mechanical 
co-ordination and system. In the second place, we have to have the 
stimulus and the definite measurement. Those are mighty impor- 
tant principles, and we know in a general way how to get at them. 
In the third place we have to get the man's co-operation, his active 
co-operation. I have seen some plants in which it seemed that this was not 
understood at all. Now, how are we going to get that co-operation? There 
seem to be several elements in it. One thing which I believe we have neg- 
lected somew r hat in many cases is the element of personal loyalty. Mr. 
Dietz last night made a most excellent talk and I was sorry we did not have 
time for questions, on the subject of Educating the Man. We can't expect 
a man to be enthusiastic when w r e say to him, "do this," and we don't tell 
him why he is doing it or what the result will be. He is just a machine. It 
was not very long ago that I had the opportunity of hearing a bunch of men 
who had not exactly struck, but had asked for an increase in wages, a bunch 
of office men. There were a lot of malcontents, and sore-heads among the 
bunch. What was the complaint? The obvious complaint was the higher 
cost of living, and of course it was a real question, but underlying that there 
were countless little questions of personal difficulty. One of the men ex- 
pressed the feeling that he had by saying that this particular company seems 
to treat us like a machine. We don't get any human consideration. The 
men have to have that if they are going to work, if they are going to be en- 
thusiastic, if w r e are going to get results, not only measured results, but in un- 
measured things, the economy of stock and things of that sort. How are 
we going to get it? One way is educating the man so. that the man knows 
what he is doing. I have personally come to the conclusion that we need 
another thing. We not only need the original idea so that the man is intelli- 
gent, but we need to give him constant contact with the management. When 
we give him an order we don't need to explain and ask his opinion about 
whether the order shall be given or not, but I think we gain a great deal if 
we at least explain to him the general theory underlying the thing, and thus 
make it intelligible to him. Those are some of the things. 

You will find in every plant some sort of an organization. There is a so- 
ciety just the same as the United States of America, or the whole world of 
sooieties. There is collective opinion, and there is collective purpose. How 
are we going to use it? Sometimes this collective opinion goes against us, and 
very strongly, and that is the kind of collective opinion wmich forms the fight- 
ing union. I believe myself that the union has its place. It is a sort of check. 
In many other ways it exercises a valuable function, but if we are to avoid a 
union or an organization which is working constantly counter to our organi- 
zation, we have to in some way capture this social spirit. We have to offer the 
men something which makes them feel we are all working together, some- 
thing which makes them see the importance of the thing that they are do- 

84 



The Importance of the Human Factor in Industrial Preparedness 

hig. That is the problem, it seems to me at present, the biggest problem in 
industry, the understanding of the social instincts and impulses underlying 
these things, and understanding the handling of men, not the purely mechan- 
ical and systematic correlation, that is important, but it is not all. How 
are we going to teach our college men that question? It is something that 
we have not completely solved. I think we solved it in part by establish- 
ing the college course. We have done something to give our college men 
broader sympathies. That is one thing needed, another is a clearer under- 
standing. Such books as Social Psychology are of extreme interest in pre- 
senting and developing this understanding of the motives that we use in 
dealing with organizations. Just how we shall do these things, how we shall 
give them the clearer understanding and the broader intelligence and sym- 
pathies is a question we are trying to work out now. We are trying to 
reach a solution of practical contact. Undoubtedly, one thing that will do 
it is to make a real contact if we can, put the man where he sees this prob- 
lem, these human problems. There are always various elements to be con- 
sidered, but there is one for which we have to have a solution some day. 
(Applause.) 

THE CHAIRMAN : Gentlemen, it is one thing to give a man a tech- 
nical education and the training, and it is another big thing to apply it. I 
would like to hear from some practical operating men here on applying 
technical knowledge in the shop. You have had your troubles, every one 
has, and some men you employ, technically trained, finely educated, fail to 
make the success they should. I would like to hear from some of you along 
that line. 

MR. PORTER : In my opinion there are two reasons why some of 
us fail. One is the utter lack of appreciation of the workman's point of 
view, too much of a tendency to see things entirely through the eyes of selfish 
and short-sighted management, and the other is too great pride of learning. 
You have got to absolutely divest yourself of that in order to get on with 
practical men. Be humble. Don't lord it over them. Make your employes 
feel that you are trying to help them, to benefit them, and you will have no 
trouble. Men naturally, I don't care where you run on to them, what 
nationality, type or state or condition, hunger for knowledge. If you cam 
show them a good thing in a simple way and convince them you are for 
them and will help them and are not trying to put something over. It took 
me several years to learn that myself, as an engineer. Be sure that you get 
their point of view. Remember, that you are trying to reconcile apparently 
conflicting interests, that in reality are not conflicing interests ; that you 
are not merely a representative of the selfish interests and trying to fetter 
them still more. Of course, there are various ways, such as the clever ad- 
vertising man using the art of suggestion and so forth to help, but it all goes 
back to those main things, be humble, be sincere and square, and, above all, 
see both sides of the question. 

THE CHAIRMAN : Mr. Porter hit the mark squarely when he said to 
be sincere and square. I certainly want to say some good words for the men 
who are coming out of the universities trained in industrial management 
along those lines. They are getting the practical point of view, and it is my 

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Western Efficiency Society Conference 



opinion that they are taking less time to be absorbed into the practical 
activities of the plant. I am sure that the courses must be very, very prac- 
tical and live in orde rto make that true. I should like to call on Mr. Mc- 
Workman. 

MR. McWORKMAN: We have had some peculiar problems, but I 
think one of the things we have learned is that it is absolutely necessary to 
begin, not at the bottom of an organization to start efficiency methods, but 
at the top. We have had some years of experience, beginning at the bot- 
tom, but just now we are realizing that the best place to begin is at the 
top. We have introduced possibly a unique function into our organiza- 
tion, which we are calling the Division of Co-operation and Inter-relation- 
ship. This function has the duty of taking care of all cross-questions be- 
tween departments and the shop. It is practically our betterment depart- 
ment, and it is concerned solely with the human relation in the factory and 
that department, and they will finally work out ways and means of putting 
the technical information to the shop people in a way that they can assimi- 
late it. (Applause.) 

MR. WALTON : I just want to say this : I am not speaking from the 
standpoint of a teacher, but from the standpoint of a practical accountant. 
It is all very well to prepare the men, to teach them what to do, but what 
good does it do unless you can persuade the business man to accept your 
views and put your systems into operation? Along the lines that have been 
talking of, one of the first things to do is to make the man and his employes 
see that you are working for them, not for yourself. You are not working for 
a fee. Your idea is that you are there to render service. Service should be 
the watchword of both the engineer and the accountant, and of all profes- 
sional men. A professional man renders services which are a long ways 
out of proportion to the amount of fee that he gets for it. A lawyer will 
give advice which is worth thousands of dollars to his client and he 
charges him $50. The same way with an engineer, with an accountant. 
That is professional work. 

Now how are you going to get these men into service? Well, 
you have got to persuade the business man that he needs the 
service. ' That is what I understand by influencing the management. 
It is very difficult for you to go there and say, I want a fee of anywhere 
from $500 to $3,000 or $4,000 for doing you a service. The fee is the im- 
material part. I am here to give you a service which will be of immense 
value to you. Incidentally, I am entitled to some reward for doing it, but 
that is not what I am here for. I am here to give you that service. Your 
statement of that is not very convincing, because he has always in the back 
of his mind the idea that you are working for a fee. 

How did we get at it in the Accountants' Association. W r e got the men 
who were independent of the accountant. For instance, Mr. Hurley, of the 
Federal Trade Commission, at first was very much ooposed to employing ac- 
countants, and a committee was appointed to meet him. They went over the 
subject with him. Thev showed him that the accountants could be of im- 
mense service to the business men just as the efficiency engineers can be of 
immense service. When Mr. Hurley comes out with a statement to the busi- 

86 



The Importance of the Human Factor in Industrial Preparedness 

ness men that they should employ accountants, that they should have proper 
accounts and that they should know their costs, that they should know 
whether their factories are efficient or not, that has some weight, because 
Mr. Hurley is not working for a fee. He is entirely independent and his 
advice is entirely unprejudiced and has an immense weight. It is the same 
way with the Federal Reserve Board. The accountants showed the Federal 
Reserve Board that they could be of immense service to the banks in going 
over their accounts of persons who borrowed from the banks. What is the 
result? The Federal Reserve Board has come out with a pamphlet with 
reference to account and has highly recommended, almost made it 
obligatory, that business men shall employ accountants. Now the Federal 
Reserve Board is not interested. They have got no fee coming to them. 
Therefore, their advice bears weight, tremendous weight. The United 
States Government has recognized the efficiency engineer and the account- 
ant now in this war program as it never has done before, but as the English 
government has recognized the chartered accountant right along. They are 
employing accountants. They asked for volunteers and from the member- 
ship of the American Institute of Accountants they received offers of serv- 
ice from four hundred members, and that service was offered, and so far as 
the principals go, with absolutely no remuneration whatever. I may be par- 
doned for saying that my partner is down at Washington today receiving 
instrutcions on four months' work, for which he will receive his traveling 
and hotel expenses and no more from the United States Government. I 
don't know what he is going to do, but he is probably going to check up 
contractors' work to see that the government is not cheated. 

Now if we are going to influence the management we want to influence 
them in such a w r ay that they will feel that the advice given them is disinter- 
ested. The advice that is given by such men as that is disinterested. Another 
thing that can be done provided you can get good speakers is to go before 
business men's associations in the different cities, and show them just exactly 
what these college professors have said that they have got, the men that 
can be if immense service to you. They don't know it. You go into a 
town of thirty, forty or fifty thousand inhabitants and you will hardly find 
a single business man that knows what efficiency in his factory is, or in 
his shop or in his store. They have to be educated. Now after they are 
educated then the accountant and the efficiency man can be of service ta 
them. The point is to educate them. If means are taken to get at the head 
men in that way they will become educated. It is very difficult for a man 
to go and say to a manufacturer, you let me into your factory and I will 
save you a lot of money. He would not believe it. Nine times out of ten 
he thinks you are simply talking from a doctrinaire's standpoint, that you 
have got a whole lot of theories. He doesn't see that theory is necessary 
before practice. Practice is simply theory put into operation. He doesn't 
understand that. He has got to be told and the best way to teach him is 
through the instrumentality of some man who hasn't got. any axes to grind. 
Those are the men that should be influenced to give the advice. The great 
trouble with all work in a factory is that unless the man, the head of the 
concern is absolutely convinced by some one in whom he has confidence that 

87 



Western Efficiency Society Conference 



you are going to be of some service to him, and that you are going to'fix 
the factory so that it will be much more efficient, or even his retail business 
for there is efficiency in a retail business, just as much as there is in a big- 
factory, if you can show him that it is going to improved, he has got to have 
that confidence in you before you begin, because when you have started to 
change a factory or his business there is always opposition. There is always 
somebody that says I don't believe in that little point. 

Another thing, after you have started to install efficient 
methods in a factory or a business, it is best to go slow at first. 
Don't upset the whole thing at once, but gradually introduce your better 
system and show the men in the factory, the man at the lathe, for instance, 
that you are working to help him. And when he sees that, if he is efficient 
that he will be worth more money, especially if he is on piece work, then he 
is interested. The difficulty has been right along that we try perhaps to 
show the employer, the head of the concern, that we are going to benefit him, 
and we don't show the foreman or the workman that we are going to benefit 
him. That is a very important point, and that is one of the things that the 
efficiency engineers and accountants try to do when they go into a place. 
They try to show the book-keepers, for instance, that they are there to help 
him, not simply to come in there to help the employer. If we can show them 
that we will gain the good will of the men, and when the system is put in 
they will carry it out. The great trouble is that when a system is put in 
and left without any supervision, some foreman says, "I don't believe in that 
particular, thing, let us cut that out." He can't see that that is a link in the 
chain, and if you break one link you have broken the whole chain. I think 
the efficiency engineers and the accountants ought to work together. There 
is no question about that, and to get their work before the people who would 
be influenced by it, and getting it before them not as a means of our earn- 
ing a fee but as a means of giving them the service that they need. For that 
reason the accountants at least frown on the men who are making a com- 
mercial business of accounting. I don't believe in commercialized account- 
ting. We want to make it a profession. The only way to make it a profes- 
sion is to persuade the men whom we have as our clients that we are ren- 
dering them more service than they are paying for, not simply earning a 
dollar fee by doing a dollar's worth of work, but earning a dollar fee by do- 
ing $10 or $20 worth of work. (Applause.) 

MR. E. V. CROUSE (International Harvester Company) : This is 
entirely a new idea for me. The idea of getting up and addressing any- 
body in a public meeting regarding anything pertaining to industrial work is 
new to me. I am not a technically trained man, unfortunately. I speak 
from the practical end of it. My experience covers 32 years of service, dur- 
ing which period I have encountered technical men and practical men in 
fifty different places. The one difficulty of the technical man entering into 
industry seems to be the particular line along which he was educated. He 
comes in with ideas which have been taught him in the colleges or technical 
schools, and they do not fit in with the management and ways and methods 
of factory manufacture. Therefore, he looks for a man to carry things 
along his way only to find that he must alter his methods to comply with 



The Importance oe the Human Factor in Industrial Preparedness 

those in vogue. I had the pleasure some fourteen or fifteen years ago of 
meeting Mr. Hugo Deimer, when he first took up the matter of shop pro- 
duction. I met him out at the McCormick Works and I knew that he had 
come there to study their ways and needs. The works at that time had 
just come in, as you may say, to the consolidation of the harvester com- 
panies, and they were operated not along strictly technical lines, outside of 
the drafting rooms, but new thoughts, new ideas were coming into the plant 
by technical men. The plant being so large these were a long while in 
being put into force. At the present time the harvester companies are mak- 
ing every endeavor possible in all of the works to align themselves with 
technical training, because the educated man, the technically educated man, 
has a greater possibility than the uneducated man. He must when he comes 
into the factory apply himself to a given extent to the processes which he 
must encounter. The change of methods means big expenditures and ways 
that will hardly fit in with present existing ideas, and therefore his road 
is a hard one for a short period. Eventually he will come into his own, and 
if he has properly applied himself, is competent, he will attain that which 
he seeks. I have found in the past and know personally a lot of men that 
have come from college, and have entered our shops, not exactly our shops, 
because my time has been divided over a dozen. One idea that seems to 
retard a man on his entrance is the fact that he thinks that when he starts 
out in business he is worth so much, and that is the greatest stumbling 
block. Manufacturers take men into their business. It is new to them. 
The work is entirely strange for a given period, and their services are not 
worth the money that they expect. As I say, time will change that, but I 
believe that the high ideas the first year or two of service in the public with 
the technical man should be brought down to what would be within the 
means of the manufacturer. (Applause.) 

THE CHAIRMAN : Mr. Crouse brought out a very practical point. 
We lay our plans very neatly to what we are going to do in the shop,. then 
we have to make them all over again. Unless we give and take we won't 
get very far. 

MR. STAFFORD MONTGOMERY: In regard to the first speaker 
this morning, the possibility of getting the technical magazines read, I think 
that in Chicago the one very good chance is to persuade all employes in an 
executive capacity— that is, clerks and strawbosses, most of whom have to 
ride for thirty minutes or more straphanging on street cars geting home at 
night, to swear off reading the afternoon paper and let them read the morn- 
ing paper coming dow r n to work, but make them promise to take one of the 
magazines home and to read it as they are hanging on the strap. That wnll 
give them thirty minutes of that magazine, and very likely thev will con- 
tinue to read for another hour after supper. In that way you will cut out a 
needless expenditure of energy. You read the news twice, in the morning 
and in the afternoon papers, which most men do anyhow, but you have got- 
ten interested in a course of study and that migrht ultimately lead up to 
those men taking one of the corresoondence school courses. 

The Doint that probablv would help in the solution of both bringing the 
matter of efficiency matters home to the management, as w r ell as to the men in 

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Western Efficiency Society Conference 



the shop, is better training in English on the part of college men, whether 
they happen to be A. B.'s or Engineers. The leading engineering schools of 
this country have no English whatever in their engineering course. None of 
the engineering courses have more than two years of English, but even the 
A. B. men who get four years of English in some of the colleges will turn 
in such miserable products to the college journal, products that have to be 
completely rewritten, and the same thing applies when they try to make a 
speech before a ball team or some impromptu gathering. The fact is they 
have no vocabulary and no delivery and a very perfunctory course in pub- 
lic speaking or the training that the law students get would be of consider- 
able value to those men, as well as some knowledge of English composition 
that even the A. B. men don't get under the present system of instruction. 
Take for example the use of the words efficiency engineer. Now that word 
is very largely used by engineers, and you would think a man with even the 
rudiments in engineering training would recognize that the word engineer 
means a man whose business it is to promote efficiency, whether he is a 
design engineer, a gas engineer or running a hydraulic power plant or man- 
aging a factory. To speak of an efficiency engineer is tautological, like 
speaking of an illuminating lamp, and yet those two words have been 
coupled together for many years by engineers and the A. B.'s and college 
professors, which indicates that they do not analyze their language suffi- 
ciently to express their meaning, and if they habitually fail to use correct 
language, both in writing and speaking, their thoughts certainly can't get 
home to the executive and to the men in the shop. (Applause.) 

G. MacKAY (Industrial Securities Company:) This gentleman here 
spoke of the human equation. It seems to me throwing facts back into 
mental categories that we could well give some attention toward placing 
our minds or our thoughts upon that which in the final analysis is the motive 
power of this thing which we call human machine. On that point I am 
going to refer to three books. One is a rather comprehensive book, namely, 
"Buckley's History on Civilization," in which he brings out very clearly the 
fact that Oriental and Asiatic Civilization must be looked at from the stand- 
point of nature on man ; the Western or European Civilization, however, is 
the control of the human factor over environment. That is the psychol- 
ogy of Western Civilization. Now we can understand why we are talking 
today of the human equation, in view of the fact that in the last forty years 
in this country the relation of the population to the potential possibilities 
of our national wealth has given rise to the greatest process of exploitation, 
and the exploiting process always brings into the forefront the exploiting 
type of mind which has a tendency to put a kibosh on loyalty and enthusi- 
asm and idealism, those things which eventually a civilization depends upon, 
and consequently there has arisen in this modern civilization, at least in this 
country during the last fortv years, a rancor and suspicion and pessimism 
that we are trying now to kill by capitalizing the human equation. 

Now this question of loyalty as been verv well brought out in two books, 
one issued some fifty or sixty years ago by Ruskin. Ruskin started, as you 
remember, as an art critic, and eventually turned to the larger thought of 
economics, particularly as he called it, mercantile economics, and 

90 



The Importance of the Human Factor in Industrial Preparedness 

in his last days he wrote a series of essays that are published by 
Everyman's Library, issued by Dutton, the first essay of which is 
called "The Roots of Honor," in which he discusses this problem of the 
motive power of this machine we call the human being, and he runs back 
into loyalty. Now the question of loyalty has been set forth in a most 
transcendent manner by a very skillful writer and profound thinker, namely, 
the late Professor Royce of Harvard, under the "Philosophy of Loyalty." 
Personally I have read a great many books on efficiency, in fact I have read 
almost everything that I could lay my hands upon, but from none of my 
reading have I received the same mental stimulus and the same mental 
enlightenment in the broadest and most comprehensive sense of the term 
as I haA^e from Royce's "Philosophy of Loyalty," for the reason that it is 
fundamentally sound, and there is a great deal that is being written today 
concerning efficiency that is more or less, I won't say superficial so much 
as it is isolated and technical. 

Now we have got to throw this movement of personal efficiency back 
into the larger category of life and living, and we have got to reorganize 
our whole industrial process so that we can capitalize loyalty, and in just so 
far as there is any success attached to the Ford Motor Company's plant it 
is because they capitalize loyalty in the lowest strata of the industrial order 
by paying a living wage. 

MR. BACON : I want to say just a word, if you please, with refer- 
ence to the work of the accountant. I want to say it in this way. I want 
to answer a question that you are putting to me now, what is the use of an 
accountant getting up here and saying things just now when we are inter- 
ested in something else? You are operating men, or most of you are effi- 
ciency men, dealing with the operating end of things, and you are always 
looking into the future. You are dealing with the immediate present, the 
tremendous present, how to get things started, and you are dealing with 
the future, how to prepare the way for larger production, and it is all present 
and future. You are live men dealing with a live problem and dealing with 
a diversified problem, for it is changing all the time, just as life changes. 

Now the accountant is by temperament and by training and by choice, 
and by every other element a recluse, an historian; he lives in the past. He 
sees what has been done. Now for that very reason the man that looks to the 
future can't sympathize with the man that looks into the past, but that is 
the very reason why we should get together, just because we are tempera- 
mentally opposed. The accountant is just trained for this, to write the his- 
tory of what you living men have done, and to write it in such a way that 
you fellows that are impatient of figures, that are temperamentally ,as I say, 
looking into the future rather than into what has been done, writing the 
story of the operations in such an interesting way that you can't take the 
time to look over the trail, what you have done, the real results of what you 
have done. Take time, if you will, away from the present and the future, to 
really study the accountant's story of what has been done. If he is a good 
accountant he will tell you his story in a few words, and he will give vou 
the true significance in a few words. You will be infinitely wiser for 
having learned accurately in detail what you have been doing. There is 

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Western Efficiency Society Conference 



just an analogy that you might draw here. It takes steam to run a steam 
engine and that is what you generate steam for in your boiler, but you have 
a little column of steam that you divert from the engine to run up into your 
steam gauge. That doesn't produce any power. If you analyze the power 
producing property of that thing you wouldn't get anyything, and yet you 
would not think of running a boiler without having a steam gauge. It just 
takes a little bit of your thought to turn away from the immediate present 
and the future, and to look back into the accountant's figures to see what 
you really have accomplished with his help in order that you may wisely 
plan for the future. (Applause.) 

THE CHAIRMAN : I have already revised my schedule several times 
and changed it during the meeting. We have passed the adjourning time, 
and I am sorry that the remaining minutes are so few, but we must hear 
from Miss Florence King, President of the Woman's Association of Com- 
merce. (Applause.) 

MISS KING: Mr. Chairman, Gentlemen and Ladies: I thank you for 
an opportunity to just say a word, and I will try to keep within the time 
limit which the speaker has said we would have. I have been greatly inter- 
ested in the subject that you have been discussing here this morning, and 
especially so that the human element is now to be considered in industrial 
preparedness. I think that is one of the big things that should be before 
this body while it is in conference, and evidently it is. You have touched 
upon several phases of that. You have talked about the technical training 
of your men and how to get them into business, that you must induce the 
business man to receive the technical product when you have finished him. 

Now this is one of the things that comes home to me, and not because of 
my own personal experience so much as I see it among all. We are living in 
one of the most critical hours in the world's history. Everything is being 
changed. We all think and speak in terms of our own experiences. You men 
have been discussing your problems this morning. You have overlooked one of 
the things that this war is going to bring directly home to you. It is no 
more my problem than it is yours. We heard from a splendid speaker here 
yesterday that the women were going to be called into the industrial enter- 
prises more than they ever have before in the world, and that certainly is 
true. They are not technically trained for many of the things that they are 
going to be called upon to do, is also true, but those of you who have been 
interested at all in following the experiences of the industrial institutions in 
England, know better perhaps than I do what an important part women 
have played and are now playing in all the industrial activities of England. 
Lord Northcliffe said a verv short time ago that if it were not for the 
women's work in England, England's industries would be paralyzed today, 
and I think that is not exaggerating it. Now we are confronting the same 
situation in the United States. Perhaps many of you men are enea^ed in 
lines of business where ultimately you will employ female labor. Whether 
vou do or not makes no difference ; vou are S'oing- to do it in the future, and 
it is uoon that subject that I wanted to sav just a few words. 

The traditions of the past have had so much to do with the position that 
women occupy in the business world that I am not willing to place any blame 

92 



The Importance oe the Human Factor in Industrial Preparedness 

upon -women if the question of efficiency arises and you find that they are not 
as highly developed, they are not as efficient in the different lines as you men 
are, because you are trained from little boys to know that some day you are 
going to have this work to do and you prepare for it. But let me suggest, 
not in any way of criticism at all, that it is the tradition of the past that 
causes all these things. How much in preparing this conference you have 
done to divert the women from the very thing they ought to have. This 
little leaflet was handed to me as I came in and while I was sitting here I 
noticed that you will have a musical tea for the ladies this afternoon where 
they will be pleasantly entertained. Now if I were to tell you just what I 
think of a musical tea for ladies, I know every one of you would say I was 
not a lady (laughter), so I am going to leave you to guess what it is. I 
mention that just to show you how much you men do to make women inef- 
ficient. 

Now the subject that you have this afternoon, "Employment Prob- 
lems," why that is just the thing that every one of those women ought to 
know something about, and yet you provide an entertainment for them 
somewhere else at a musical tea. Why, a musical tea means to me that I 
think the froth on a glass of beer means to you. (Laughter.) I wish there 
was some way of calling off your musical tea and bringing every one of 
those women here to hear the splendid talks you will have this afternoon, 
and likewise while I wouldn't want to wish a misfortune to anybody's auto- 
mobile, but I wish something would happen that they couldn't go out on the 
automobile ride tomorrow to Lincoln Park or somewhere else. You can 
see the park and the whole outdoors, it is so beautiful this time of the year, 
but it is not necessary to provide a special entertainment of that kind. I 
say that in all sincerity, because I say they would learn so much more if 
they could be brought in here and hear what you men have to say about 
employment problems and how to solve them, because they are going to 
have to enter into some of these things and help to solve them. With the 
readjustment of all of our industrial affairs, you know that you are going 
to have to come to this. You are going to have women in your business, 
whatever it may be. You are going to have to take them as unskilled labor. 
Now, as some one has said here today, when you take a novice into an office, 
of course it is not possible to pay that novice what he thinks he is worth. 
We all know that he thinks of that in terms of his own experience, because 
it is how much can he get along with and pay rent, living expenses and so 
forth. He just has to have so much money. So it is with these women. 
We know the condition that exists in the business world, and when some 
of you men empoy la woman you have done it because you will pay her less 
wages to do the same work. That is not giving us a square deal, and I do 
feel the least that any industry could do would be to exact the same service, 
but give the same compensation. (Applause.) 

Now that women are coming in at this time when these 
problems are being forced upon women — you know women didn't bring 
this war on, but we are going to be called upon to help carry 
its burdens just as you men are — but do any of you know in the 
history of the world when any government, any nation was in war, that that 

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Western Efficiency Society Conference 



government called upon the women to help finance the war? Never. But 
you know they are doing it today. They have set aside a part of this bond 
issue to be sold to women. They have already interested women to go out 
and sell these bonds to women. They must be sold and 'they are urging it 
just as insistently as they are to you men. Now I have no criticism of that. 
That is all right. We get the protection of our government just as you do, 
and I have no word to say against that. That is the way it ought to be 
done, but I do w T ish that a time might come when all of these things might 
be equalized, and where we take equal responsibilities that we might have 
equal compensation and equal recognition all the way through. I may per- 
haps be a little more fortunate than many of my sisters in having been 
engaged in business here for so long and in a line of business where I come 
in contact with business men every day. I know the ways that men have 
found successful in their business, and I have tried to study them just as 
carefully as I know how. Just as some of you men have said, you were not 
technically trained when you started, but you have gained your knowledge 
from practical experience. So have I. I say again I am not interested in 
musical teas. I am not interested in making lace for pillow shams or frost- 
ing for cake, or anything of that kind, and so when opportunity comes along 
of hearing you men analyze the problems of the day, it is wrong that we 
can't have this whole room filled with women so they would learn how you 
analyze and how you get results. That is what they should know and what 
they will have to know in order to get out and meet the responsibilities that 
will be placed upon them. As you know, if this war goes on these women 
who are going into industries are not only supporting themselves, but every 
one is supporting some one else, dependent parents or brothers or sisters, 
and many a woman is supporting a family of little children. If there is a 
human element that needs greater consideration at this time I do not know 
what it is. So if I can only leave with you the idea that you keep that in 
your minds, and where you have a chance to give the woman an oppor- 
tunity, exact the same service from her that you do of your men, but give 
her the same pay and give her the same opportunities, and I and many will 
be very grateful to you. (Applause.) 

MR. PORTER : I thought it would be of interest in connection with 
Miss King's talk to tell of the stand that has been taken by the Detroit 
Executives' Club on this matter. They authorized about two months ago an 
investigation of Detroit industries looking to the possibilities of the substi- 
tution of men with women. The staff of the Club has been busy during 
the interval in making a rather extensive survey of plants who w^ere willing 
to be surveyed in this connection. The managers in conference representing 
some of the leading plants in Detroit adopted as one of their principles equal 
pay for equal work, and I think most of the manufacturers in Detroit are 
committed to that principle. 

Just one further thought, that already we are finding that women are 
not only capable of performing equal service, but superior service. They 
are leading the way to newer and highe standards of efficiency, because they 
enter industry freed from the traditions that have held men back for genera- 
tions. The young man who starts to w^ork, if he is ambitious and wants to 

94 



The Importance of the Human Factor in Industrial Preparedness 

let himself out and do his best, very soon is brought down to eatrh, as a rule 
by his older fellows, who have been soured and embittered and a good many 
are earning three and four times as much as the men ever did ; they are 
earning as much as $45 a week, where men were satisfied to earn $17 
bcause they have let themselves out, and they are doing four and five times 
as much work as the men ever did. It is a very interesting fact. (Applause.) 

MR. SEGUR: I move that we extend to the women of Chicago an 
invitation to attend any or all of these meetings which they desire and that 
we give to the women of Chicago the privilege of attending either the meet- 
ings held here at the Auditorium or the entertainment features which may 
be provided. 

MR. HANSON : I heartily agree with the spirit of the motion. Might 
I remind you that our invitation already is extended to both men and 
women? I think this is just a suggestion rather than a new matter for the 
Western Efficiency Society to take up. I would like to see that made as a 
suggestion, that the committee reiterate its invitation and again bring it to 
the attention of the women. 

THE CHAIRMAN: We will put it as the expression of this Round 
Table. All in favor say aye, contrary, no. The motion is carried. I should 
like Miss King to know that invitations to attend this conference were sent 
about ten days ago to all the Women's Clubs in Chicago. 

An adjournment was then taken. 



95 



FOURTH SESSION 

Thursday Afternoon, May 24, 1917. 
Mr. F. M. Simons, Jr., Chairman. 

CHAIRMAN SIMONS: I believe it is the attribute of a good Chair- 
man at a meeting, and especially where we have such good speakers, to 
efface himself at the outset, and I shall at once introduce Mr. Grieves, Assist- 
ant Secretary of the Jeffrey Manufacturing Company, Columbus, Ohio. We 
are exceedingly fortunate in having with us a man of Mr. Grieves' experi- 
ence and achievements, and I am very happy to introduce him to you this 
afternoon. He will talk to you on "Stabilizing Our Labor Units." Mr. 
Grieves. (Applause.) 

MR. W. A. GRIEVES : Mr. Chairman, Members of the Western Effi- 
ciency Society, Ladies and Gentlemen : It would be stating a platitude on 
my part to say that I am delighted to be with you. I am. I have been 
tremendously impressed with the splendid spirit of honesty that has charac- 
terized the different sessions thus far in your convention. I was somewhat 
concerned, however, in some of our sessions yesterday, about the over- 
anxiousness on the part of some of us in regard to government matters. 
Now, it is customary for us, and we have some foundation for believing that 
there is too little activity, particularly at such times when we have such 
momentous questions as we have today brought up, to criticize the activi- 
ties of government. I for one feel very optimistic about the situation. I 
feel that the government is not going to overlook the men who are really 
valuable in this crisis. I think that Secretary of War Baker or President 
Wilson is not going to overlook such men as Harrington Emerson, C. E. 
Knoeppel, Mr. Edison, and all these other men, leaders in the great effi- 
ciency movement of today. I believe these men have not only been con- 
sulted, but will continue to be consulted, and that when the proper time 
comes, that their wisdom and their experience will be called upon to help 
solve the pressing problems of today. I want to say that I do not know, 
how you feel about it, but I feel very optimistic. These men are not going 
to be overlooked. They are big men. And your Western Efficiency Soci- 
ety, I believe, is not going to be overlooked when the proper time comes 
for' you to be of assistance, and I think Mr. Knoeppel in his splendid 
address yesterday gave us sufficient evidence of that fact. 

Now, to my cup. I would much prefer to speak extemporaneously, but 
it is so hard for those of us business men who are not accustomed to speak, 
in public, that I have written what I have to say. I was a few moments 
ago, in our room, when I asked my good wife where my speech was. I 
couldn't find it for the moment. I thought perhaps it had been lost on the 

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way over. I began to feel a lot like the gentleman from Minnesota, the 
other day, who came down from the Masonic Conclave at Columbus. He 
was the principal speaker of the occasion and when called upon he said that 
he was very sorry to state that he had lost his speech, that he had written 
what, seemed to him to be the best speech that he had ever written. He 
found that in his travel down through Columbus, that somebody had taken 
his suit-ease, and he had gotten hold of somebody else's. He was greatly dis- 
mayed to find that it was Glady's suit-case, and the material contained 
therein was somewhat embarrassing to him, but he was consoled when he 
found some agreement between them, when he found Glady's cigarettes and 
his were of the same brand. (Laughter.) 

I have what I have written, gentlemen, if it is of any interest to you. 
(Applause.) 

STABILIZING OUR LABOR UNITS. 

Present-day industrialism is marked by the rise of an unmistakable 
desire for better things. The air is charged with the spirit of a broader con- 
ception of the rights of others. A glowing ambition has taken possession of 
our industrial activity. It is not ambition confined to the limits of sordid 
self-aggrandizement, but has as its aim the fundamental good of the class. 
It is the culmination of the effect of the various influences that have been at 
work for many decades, and the practical working out of its ideals is one of 
the best evidences we have of our industrial and social security. It is the 
humanizing of industry. We are proud of it. Its coming increases our 
faith in each other, although it has had to climb over rugged walls of sel- 
fishness and indifference in reaching us. It may be that this selfishness and 
indifference has given rise to the need to which this spirit is an immediate 
response, and consequently the desire to improve conditions appeals not 
only to our sense of fraternity, but also to our good business judgment. 

At the very outset, therefore, we are confronted with the question, 
What is the objective? What are the means to be employed in reaching that 
object? Are the methods thus far adopted in line with ideas of permanency? 
That the purpose is intended to do good, would not be going much farther 
than stating a platitude. That is not enough. Intelligent service must have 
feasible aims. Further than that, even if the aim is definite, and we are 
agreed that it is desirable, it is important to know by what methods our pur- 
pose is to be reached. We may be perfectly in harmony as to the result to 
be obtained, yet there may be honest differences of opinion as to the feasi- 
bility of indicated methods. 

Human engineering is an agency that has come into being as a result 
of demands made for the improvement of industrial conditions. It is a part 
of the crusade for the advancement of ideals of the people engaged in our 
great army of industry. It is an honest desire on the part of the better ele- 
ments in our industrial life to emphasize the slogan that, "Industry is for 
humanity, and not humanity for industry." 

The other day we attended a meeting of employers. The meeting was 
one of many that had been held to discover ways and means of creating 

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The Importance of the Human Factor in Industrial Preparedness 



confidence between these employers and their employees. The chairman 
opened the meeting somewhat as follows : 

"Gentlemen, I have been studying this so-called labor problem for a 
number of years. I have seen all sorts of schemes attempted to demon- 
strate to workmen that employers are really in earnest concerning the wel- 
fare of those whom they employ, that they want to pay the very highest 
wages they can and meet competition, improve working conditions in the 
shops and encourage other methods which will create the confidence we are 
seeking. But I believe we have not looked deep enough for the cause. 

"In our factory, for example, there are a number of different nationali- 
ties. There are varying degrees of intelligence represented. The men in 
general are up to the average; but for some reason the whole force lacks 
homogeneity. There does not seem to be any community idea among them. 
Their aims appear .to be diversified to a degree that indicates heterogeneity. 
There is a lack of unity and thought in our whole organization. 

"The time has come when, it seems to me, we must do something more 
than pay the highest wages — something more than insure good physical 
working conditions in the shops. There must be something done to help 
our people realize that they are more than hired hands, carrying out more 
or less willingly the instructions issued to them in their daily work. 

"I feel that as far as we are concerned something must be done to weld 
together the ideals of our people in such a way as will mean something 
to them. 

"We have many of the so-called welfare activities which have been 
started by us for our employees, but the whole affair lacks a medium of 
co-ordination essential to stability. Our task seems to be to get our people 
to realize that we really are in earnest — that they are really as much con- 
cerned, financially and otherwise, as we are. 

"Although we are paying the highest wages and our shop working con- 
ditions are the best, our employees do not manifest such interest as would 
indicate solidity as far as they are concerned." - 

Now this employer has expressed in a more or less clear manner just 
what lies, maybe unconsciously, in the minds of all employers who are try-" 
ing to work out the question of better understanding of the human equation 
in industry. 

The most exacting problem, therefore, before the industrial world today 
is that of stabilizing our labor units. And included in this statement is a 
deeper significance than that which may apply to the staying qualities of 
the man on the job, important as that phase of the subject is. We are hear- 
ing a great deal these days about labor turn-over due to the constant shift- 
ing of employees from one job to another, and it is vital that we heed the 
warnings of these men who have made such thorough investigations and 
given us figures representing such enormous economic losses. But there is 
emphasized at this time, due to the great international conflict, an increasing 
responsibility to look deeply for the real causes of industrial misunderstand- 
ing and instability. 

The employer just referred to has caught a vision. He has called to our 
attention the fact that little permanent progress is going to be made in the 

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stabilizing of our labor units unless we "go further than we have. Recent 
investigations have shown that eighty to eighty-five per cent of the shifting 
done by our industrial workers is confined to the lower grade of help. And 
figures have been recently secured which show that over seventy per cent 
of this lower grade of workers is made up of our foreign born. Take for 
example some of our leading industries. In iron and steel nearly 58 per 
cent of the workers are foreign born; in coal mining nearly 70 per cent; in 
the textile industries nearly 70 per cent ; in clothing nearly 73 per cent ; while 
in the railroad maintenance nearly 67 per cent of the laborers are for- 
eign born. 

The war is hammering home some very impressive lessons. We have 
boasted much of our being the great international melting pot for the mil- 
lions who have been coming to our shores ; but a close analysis will reveal 
the fact that the pot has scarcely been simmering, and the work of creating 
the spirit of true Americanism has not been done. We have neglected to 
furnish the fuel of patriotism with which the melting pot can be kept boiling. 

One of our big questions, therefore, is, What is the employer doing to 
make this great industrial army a stabilized unit? These people are in the 
hands of the employer eight to twelve hours each day. What is being done 
to interest them in American ideals? What is being done to maxe them feel 
that their life amongst us is more than that of tire nomad? This seventy to 
seventy-five per cent of unassimilated humanity is in a pliable condition; it 
is ready to be led in the direction of the strongest leader. Is that leader 
going to be the I. W. W. agitator? Is it going to be the unscrupulous soap- 
box orator; or is it going to be the man or the company whose opportunity 
it is to know and whose privilege it is to develop within the hearts and 
minds of these heterogenous millions the true American spirit? 

It is obvious that these brothers of foreign birth,, upon whom we are 
depending for the great bulk of the physical development, cannot be success- 
fully assimilated so long as American contacts and opportunities are closed 
to them through language limitations. Our first duty, therefore, is an indi- 
vidual plant census to find out how many workers do not speak English and 
are not citizens. If we do not have a night school in our own individual 
plants, cannot the community night school be established? If our shop 
hours do not permit of regular attendance, cannot they be so arranged that 
they will? Is it practical to have classes conducted within the plant on Com- 
pany time? Would not the higher standard of work secured through this- 
increased intelligence more than repay the financial expense? And similar 
questions obtain as to citizenship. Are we emphasizing the advantages of 
being an American citizen? In the hiring of this almost seventy per cent 
of our industrial workers are we not overlooking a great big opportunity in 
failing to emphasize the importance of naturalization? 

As we have already intimated, we are looking to the men and women 
who are citizens of other countries to do the great bulk of labor in our most 
essential industries, and yet we are not awake to the fact that we are build- 
ing these industries without regard to the permanency, loyalty and stability 
of those upon whom we must depend for successfully maintaining them. 

To know how to speak our language and get the desire to become a citi- 

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The Importance of the Human F actor in Industrial Preparedness 

zen will go a long way along the road to Americanization. Social and indus- 
trial justice, however, must prevail to win and hold the hearts of men for a 
new country. If we build model factories, perfect for materials and ma- 
chines, and forget to provide pure drinking water, proper toilet facilities and 
comfortable eating places, Ave cannot hope to stimulate enthusiastic confi- 
dence in American ideals. It is only a few weeks since I received an an- 
nouncement of the opening of a three-hundred-thousand-dollar club house for 
the employees of one of our large manufacturers. That is a good thing to 
do if the building and equipment were suited to the needs of the employees. 
But it isn't. Over eighty per cent, I am told, of the employees of this con- 
cern are foreign born, cannot speak English, and have never applied for citi- 
zenship. What a fine start that three hundred thousand dollars would make 
in establishing schools for the teaching of English in the homes and neigh- 
borhoods of those thousands of foreigners. How much of it could have been 
used in training those employees' families in the wholesome methods of our 
better American housekeeping. How many of that eighty per cent of for- 
eign employees of this concern are going to participate in the club privileges 
of that more than quarter million investment? Mighty few! The immi- 
grant employee knows this well, although he may not say so. He is more 
likely to quit in silence. 

The other day I visited a factory that is typical of the consideration 
showm for our un-Americanized units. This particular institution employs 
only a comparatively small per cent of foreign speaking people — about three 
hundred, it was ascertained — and while every provision had been made for 
the safety and comfort of the American speaking employees, absolutely noth- 
ing had been provided in the way of wholesome sanitary comforts for these 
three hundred souls who had had the apparent misfortune of being born in 
another country. 

It is certainly anything but a broad business policy that proceeds upon 
the theory that the class distinction that has been raised between foreign and 
native born can be obliterated so long as choicest locations are selected for 
factory sites and imposing buildings erected, and at the same time the men 
are left to live in hovels and bunkhouses in Hunkie town or Dago flats. 

The time has come when we as a people must wake up to the fact that 
about thirty-five millions of our much-boasted one hundred million popula- 
tion is foreign born or the children of foreign born. It isn't a question of 
what we may want to do ; there is an imperative demand for action. The 
only way in which these people are going to be stabilized in our industries is 
to Americanize them. To Americanize them means that equal consideration 
must be shown as is given our American born. I know this is not a popular 
doctrine, and the fact that it is not popular is the principal reason for our 
enormous industrial instability. So long as men are discharged without 
reason or recourse, so long as no effort is made to find out why men quit 
their jobs, so long as our industries are contented to carry the tremendous 
burden of millions of dollars every year in unnecessary shifting of workers, 
the assimilation of the alien is impossible. If a man has no patriotism for 
the country in which he makes his living, how can he have much patriotism 
or loyalty for the institution for which he works? If he has no loyalty for 

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the concern that makes it possible for him to make this living, how is it to be 
expected that he can be counted upon especially in trying periods such as 
we are now experiencing? 

The trouble is we have not taken our own patriotism seriously. It has 
been taken for granted, so to speak, and as a consequence we have forgotten 
our responsibilty to those who have come among us and to whom we are 
looking do the real manual labor of our wealth-producing agencies. In our 
desire to get rich and create wealth, we have overlooked our duty to create 
citizenship. Can we continue to neglect posterity for prosperity? If, as 
some of our thinkers contend, we have been extending our national power 
beyond the ability to defend it, may it not also be possible that we are ex- 
tending our industrial power beyond the limits for which we have made ad- 
equate protection as it applies to our labor units? I believe it is. 

It is unfortunate that in dealing with our human relations in industry 
that so few have caught the spirit of the times. Out of hundreds of employ- 
ers who have visited our plant during the past year or two, it is surprising 
how few there were who caught the real big idea, as it seems to us in estab- 
lishing that relationship that is to prove the permanent basis for stability in 
future industry. The predominating idea seems to be that whatever is done 
must be conceived, worked out, maintained and financed by the employer. 
Such a comparatively few employers have caught the vision of what can be 
accomplished by co-operating with the employee. The average business man 
seems to regard any step in dealing with human relations in industry as a 
sort of philanthropy. He fails to see that it is related to every division of 
production, and must be so accounted. The tendency is to confine it to the 
employment office, safety work, or recreational activities, failing to realize it 
is just as important a part of the whole scheme of production as his sales or 
financial departments. And the men usually placed in charge are of the 
kind that would not be tolerated for a moment in the sales producing end 
of our business. 

One of our biggest manufacturers has made the statement that there 
were three very fundamental elements entering into the make-up of indus- 
try — men, money and machines. He has said that there is very little diffi- 
culty in getting: money ; that it was not hard to get machines ; but that it was . 
a tremendous task to get men. But we think that he did not go far enough. 
He should have added : "It is still a greater problem to keep men after you 
have once hired them." And this, is the particular phase of this subject of 
human engineering to which we wish to direct our discussion. 

To get before us the magnitude of the problem and of how vital it is in 
business to-day, we would like to mention a recent investigation that re- 
vealed a remarkable condition. It refers to our own experience and illus- 
trates how organized co-operative effort can bring about the very things we 
are seeking to the end that our labor units may be made more permanent. 

About seven years ago to maintain a force of 2,200 employees, our firm 
was hiring on an average of 5,000 employees each- year. We began a sys- 
tematic study of the causes entering into this tremendous shifting. We 
were convinced that something was wrong. We had prided ourselves on 
having a fairly scientific method of selection. We had gone on the assump- 

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The Importance of the Human Factor in Industrial Preparedness 

tion that if a proper study were given to the placing of men at the beginning 
of their service, the employment problem was handled as best it could be. 
But we had not analyzed correctly. We had led ourselves into the belief 
that if the slant of a prospective employees' eye was at a certain angle, or 
his ears drooped at a degree scientifically correct, or that he had the pro- 
verbial high forehead, or that his jaw did not recede too abruptly, we had 
done all that was necessary in determining what was desirable in the way of 
selection, and consequently our problem was solved. 

But you see we were trying to get a solution of our difficulty by study- 
ing an effect in the way of an excursion into the realm of physiological psy- 
chology, when we should have been looking into the real cause of our hav- 
ing to pay so much attention to selection. It finally occurred to us that if 
more interest were shown in the causes for men leaving our employ after 
they were hired, it would be more profitable than being so much concerned 
about selection, important as that phase of industrial management is. So 
instead of looking upon the employment office as being such an asset, we 
began to think that it might be, in view of our failure to locate the real rea- 
son, a sort of liability. Results proved the logic of our reasoning. We main- 
tained that if John Smith came into our employ and in a short time left, 
there must be some reason for his quitting. In fact, he did quit to the ex- 
tent of nearly three times every year. In other words, the whole force, nu- 
merically, turned over about three times annually. What was the cause? 
It could not be wages ; for we had already learned that if we were to have 
competent men we must pay the best rate. It could not be that the general 
attitude of our organization was such as to produce a condition of this kind, 
for the spirit of our firm was good above the average. It was not because 
of lack of sympathetic understanding on the part of the management, for 
this general relationship had always been of the true spirit of mutuality. 

A systematic study of the causes revealed the fact that this wholesale 
shifting was largely due to conditions that really concerned the relationship 
of the men among themselves. There were abuses existing in the various 
departments of which the management had not been aware. There had not 
been any general effort exerted by the foreman to deal with the men on the 
basis of mutual understanding. If an employee erred in the performance 
of a task, the old idea of discharge was resorted to. The realization was not 
apparent that the company had a large investment in the men discharged. 
There had not been any getting together of the heads of departments so that 
a broader understanding of their respective difficulties could be acquired. 
There had been very little attention paid to the troubles of the employees 
as related to their home life. No systematic study had been made of the 
cause of accidents and of how they could be prevented. There had not been 
any attempt to stimulate within the organization the spirit of aggressive- 
ness as it could be applied to the employees initiating- and developing en- 
terprises for their mutual benefit. And yet, up to that time, we were counted 
anions: the more progressive. 

After a systematic program had been conceived and put into operation, 
the turnover began to diminish. A thorough study of the causes of acci- 
dents was made. A hospital with trained nurses and physicians was estab- 

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Western Efficiency Society Conference 



lished. Foremen's meeting's to discuss methods of closer co-operation were 
begun. If an employee did not make good in the department to which he 
had been assigned, he was given a trial in another at different work. If 
he was slow to learn, greater patience was exercised in teaching, going on 
the scientifically good reason that if he was let go, the opportunity of get- 
ting any one better was not probable. Judicious interest was taken in the 
home life of employees ; not to the extent of exceeding the limits of desira- 
bility, but in all cases where real helpfulness would be appreciated. Em- 
ployees co-operative enterprises, entirely under the control of themselves, 
were started. Full freedom in the outline of procedure was given. When 
any change in methods, effecting to a degree the work of the men, were 
made, the opinions of every man were solicited. Each employee understood 
that if he had a suggestion to make for the improvement of a certain condi- 
tion, it would be given honest consideration. Many other activities were 
started of a co-operative nature that proved beneficial both from a physical 
and financial standpoint. For example, our employees' co-operative stores, 
restaurant and bakery, in which they are doing over $325,000.00 business 
each year, and our employees' building and loan association in which they 
are going on an average of $250,000.00 business each year, all started and 
operated by the employees themselves. And what was the result? Inside 
of six years the number hired to maintain the average force of 2,200 was 
reduced from 5,000 to 1,500. 

Thinking that our own experience might not be a fair one from which to 
draw conclusions in the matter of labor turnover, we made investigation. We 
approached forty different firms in similar lines of industry for the purpose 
of getting their experience in this matter of turnover, only twenty of which 
were able to furnish definite data. The investigation revealed the fact that 
to maintain an average force of 44,000 men in these twenty concerns for the 
previous year, 70,000 were hired. 

From the standpoint of waste you will readily appreciate the necessity 
of searching deeply for the cause of this shifting. The fact that millions 
of dollars are unnecessarily being spent annually in the changing of indus- 
trial forces, indicates not only the necessity of scientific selection, but also 
of greater humanity in handling. The call for men with broad intelligence 
and an understanding of the human element in shops and factories is ur- 
gent. Business men are awaking to the fact that the so-called labor prob- 
lem is not so much of a problem after all. They are beginning to see that 
it expresses itself more in the form of a condition, and are convinced that 
when the causes of the conditions are removed, the problem adjusts itself. 

What we need most is men educated to understand the human factor. 
The good business sense of our manufacturers is not going to allow them 
to continue to ignore the leak of millions each year through a source that 
can be prevented. We need men so trained for leadership that the less in- 
telligent can be led to a higher place of thinking and working. 

The trouble has been that the selling and engineering end of industry 
has called all our trained men, to the very great detriment of the producing 
portion. What we need as leaders among our shop forces are men of higher 
intellectual standing. The time is coming, in fact it has already arrived. 

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The Importance of the Human Factor in Industrial Preparedness 

when the shop foreman will be required not only to be a shop trained man 
but also a college trained man. It requires just as big calibre men to con- 
duct and handle the shop forces as it does the sales or engineering. In the 
past we have not thought so, but it is none the less true. Is it any wonder 
we have labor disputes? Is it any wonder that men have misunderstood 
their employer? The trouble has been that both have sat complacently and 
allowed themselves to be advertised by those who do not know — allowed 
themselves to be shown wrong side up, as it were. 

You may recall many paternalistic enterprises that have been started as 
a solution of the so-called labor problem; but you will also recall that none 
of these has proved effective, and for the good reason that they were not 
fundamentally conceived. Any plan that smacks of paternalism cannot suc- 
ceed. It must be a wholehearted effort to get to the bottom of discontent, 
and this can only be accomplished when the spirit of confidence is secured. 
The average man is at once more or less suspicious of any attempt to hand 
him something for which he was not looking. 

Many of us are at least somewhat familiar with the early experience of 
those employers who introduced new methods of production and payment 
into their factories. We know how they were misunderstood. Some made 
the mistake of pushing the plans too hard — forcing them upon the men be- 
fore they grasped the real purpose. Others were wiser and adopted the plan 
of getting hold of those men who were most intelligent and so instructing 
them that their influence and proper understanding made it easy to reach 
the more incredulous. And this is where the good judgment of the leaders 
called to handle men will prove an asset. Every organization should pay 
particular attention to the selection of their leaders or department heads, for 
as the head is, so will be his men. You cannot have an unintelligent depart- 
ment head and expect the men in that department to be up to the standard. 
Like begets like. We create as we think. If we think disorderly thoughts 
we have disorderly people and things about us. Men unconsciously gather 
about them people of their own viewpoint and disposition. 

Men refuse, and they have a right, to be regarded as objects of charity 
or as parts of a great producing machine. Important as are different sys- 
tems of present day production, and with all consideration for their indus- 
trial value and necessity, all must be built upon well defined principles, or 
in other words — the science of human relationships ; and any system that 
disregards this, must fail. 

Humanity does not differ to any great extent on the average. Men do 
not want to be paternalized ; but they are responsive to kindly consideration. 
They may not manifest much enthusiasm at the mention of the company 
for whom they work; but if the leading personality of that company has 
shown itself to be human — to be interested in the troubles, joys and inci- 
dents that go to make up the life of the men who constitute the basis of its 
existence, there is a response that is really manifest. 

If our labor units are to be stabilized, human relations cannot be sep- 
arated from the whole organization and placed under the direction of one 
department. It must be a definite policy that has as its principle aim the 
co-ordinating of every element. There is not going to be much progress 

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Western Efficiency Society Conference 



made where the attempt is one-sided. When men are made to realize that 
there is practically no limit to their co-operative possibilities; when they 
are convinced that there is an absolutely honest desire on the part of- the 
firm to share the fruits of combined effort, and when there is evidence of con- 
fidence in their ability to do a real work other than that of the grind mon- 
otonous, encouraging- headway will have been made in the movement to 
stabilize. But this work cannot be done by either or alone. The task of 
industrial stabilization is to find that form of human relationship manage- 
ment that will make the foreigner a good workman and loyal citizen, and 
the American worker conscious of his latent possibilities. It is not impos- 
sible. In fact, it is not really difficult. It is being done. We have made 
splendid advance in our own organization. But we have avoided the slight- 
est indication of paternalistic motive. We have emphasized the belief that 
the stability of our workers and a better understanding between them and 
ourselves cannot be created and permanently maintained by purchasing 
good will with such agencies, as the men themselves do not have a part in 
creating. 

CHAIRMAN SIMONS: The next speaker on the program is Mir. 
Earl Dean Howard. He has been actively engaged in the past two years 
in working out a scheme of labor control in the Hart, Schaffner & Marx 
plant in this city. 

MR. EARL DEAN HOWARD : Mr. Chairman, Members of the West- 
ern Efficiency Society, Ladies and Gentlemen : I should like to have it un- 
derstood that the things which I am going to tell you about were the work 
of my own hand. I am simply one of a group of men who have been ani- 
mated by a common idea, and together we have experimented for about six 
years in attempting to work out in a concrete and particular way, perhaps 
without always being conscious of it, some of the ideals which have been 
so admirably presented to you by Mr. Grieves. In fact, his address is a very 
excellent preliminary preparation to what I should say, and because of it I 
shall attempt to give you more of the particular difficulties and problems, 
and our manner of dealing with them, than I otherwise might. 

The Hart, Schaffner & Marx labor plan, of course, is somewhat well- 
known. It has been in existence for six years, and considerable has been 
said and written about it, and it is my desire to give you, if I can, the funda- 
mental principle of it before I get through. We are all, of course, thinking 
of labor problems, and of the purposes of industrialism right now, in terms 
of the war, and we are in the process of adjustment. The whole world of 
industrialism, the ideals and practices, we know are passing away, and they 
will not return again. It is the duty of all of us who have responsibilities 
to make this adjustment mentally as quickly as we can, to be prepared for 
what lies ahead of us. We have to guide us the experience of the countries 
which have been at war, particularly England and Canada. One of the 
things, I believe, that must have struck us all recently, has been the great 
change in England, in the relative position of labor in the country, as a 
part of that country. The visit of the British labor reoresentatives to this 
city has recently called attention to that. Some public addresses and a 
great deal of writing on the subject has made it plain to us that labor occu- 

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The Importance of the Human Factor in Industrial Preparedness 

pies a very much higher relative position, is much more respected, and is 
much more esteemed and regarded with much more equality by the classes 
in England than ever before. In fact, it has amounted to a revolution. 
And I think we are just becoming aware of it. 

Now, it is quite likely that in this country something of the same sort is 
going to take place, and therefore in future dealing with labor and the labor 
problem we must take account of that. The reasons for it are very plain, 
and they are bound to be duplicated in this country. When the minds of 
men are suddenly turned from individual interests to a great common inter- 
est, a great patriotic interest in doing service for their country, they become 
different men, and their relations become different. Men who are doing 
their bit in the trenches or in industry, or wherever they are doing some- 
thing in which the motive of public service rather than private gain enters, 
become different men. They become very much more self-respecting, they 
are much more respected by the people in the country, by all classes, and 
that is the reason why in England and Canada labor has become so much 
more esteemed and occupies such a relatively higher position. Its opinion 
is sought. It is asked to co-operate as never before. Now, those same con- 
ditions are going to prevail in this country, because men are going to have 
an opportunity to increase their own self-respect and measurement, because 
men are going to learn to subordinate their individual and even their class 
interests to the great common interests. We can't imagine that when the 
war is over we are all going back again to the old way of thinking, the old 
relations. We are going to be a very much more homogenous people. The 
differences between one class of men and another are not going to be so 
great as they were before, perhaps, and for that reason we must adjust our 
systems of industry to meet that. 

Now, I am going to make these remarks because I think that in the 
experiment which we have carried on at our place, we have built, perhaps 
largely unconsciously, with this very thing; and perhaps are prepared for 
this change more than some others. We have dealt with all complex and 
organized groups. They are practically all members — that is, the manufac- 
turing body, are practically all members of labor unions, and we deal with 
our people through the labor unions. Possibly the labor union is not going 
to be in the future the typical forms of organization, but this we do know, I 
think, that is, all. of us know who have studied the problem that in the 
future we must deal with groups organized in whatever way they may be. 
We are dealing now with groups, perhaps, even though we congratulate our- 
selves that we haven't the union problem. Anyone familiar with a manufac- 
turing establishment of almost any kind, knows that he is dealing with men 
collectively. They have common ideas, common purposes, and they have 
to be met in that way. Perhaps it is not quite so apparent that they are 
organized in unions, but they have that opportunity. 

Now, after the war I believe that this is going to be true. That human 
beings are going to have to work in groups, and loyalty to the group and 
subordination of. individual interest to the group is going to be very much 
improved and a very much more effective thing in the future than it has in 
the past. Whether we like it or not, we must learn to operate that way. 

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Western Efficiency Society Conference 



The day of the hero, the strong man who bends everyone to his will is going 
to pass, I think. It is in the air, the resistance to autocracy. It simply 
means the rule of a strong man given authority and power, whether he 
exercised that benificently or otherwise, is going to pass. Whether for 
good or for ill we cannot say. We are going to be governed by representa- 
tives in a democratic form of government. 

Now, inasmuch as every industry is really a form of government, in 
the past very autocratic, it seems to me this same spirit will have to per- 
mate. Whether it will lead to greater or less efficiency we do not know, 
probably less at first until we know how to use. those forces to produce effi- 
ciency. We will have to go through a long period of inefficient democracy, 
or at least some of those ideas, democratic ideas must be dealt with until 
we learn how to make them efficient. We are struggling now through this 
crisis in this country, struggling to make our representative government 
efficient to meet the situation, and we know that it can't be as efficient, as 
we are organized now, after years of neglect we know that it can't be as a 
highly organized autocracy, but there is no reason why there shouldn't be 
discovered in it a great many sources of strength which autocracy doesn't 
have. We are all delighted whenever we see a hint that the French, be- 
cause of their form of organization, of democracy, and equality of the peo- 
ple, have a military superiority over the German, who has deliberately 
adopted the other type and subordinated himself absolutely to an autocrat. 
And I think we see that, and we realize that there is something in democ- 
racy which is stronger than any autocracy. 

Now, perhaps, those ideas apply to industry, and our experiment in 
Hart, Schaffner & Marx has had to deal with the idea of representative gov- 
ernment, and we have attempted to make the most use of that idea, to make 
the work as effective as we can, in the past six years, and we have had per- 
haps some success with it. We went at it first unconsciously. Six years ago 
there was a great strike in the city, including our plants. It was a very long 
and distressing conflict, as a great many strikes are. Most of us are familiar 
with them. And when it was over the company decided to adopt arbitra- 
tion, not knowing a great deal as to what it implied. It was simply one 
way of settling the trouble, and we agreed to do it, not knowing at all what 
was going to be brought forth before we got through with it. 

One thing which was done at that time made the experiment perhaps a 
little different from the ordinary arbitration experiment. The company 
suffered so severely from that strike, not only in the last part of the season 
— loss — but in the after effects, in the disorganization which had been created. 
In an industry such as ours, disorganization is very hard to repair. The 
industry is composed of a great number of small operations, each one of 
them often must fit in and co-ordinate perfectly with every other, and none 
of them are so highly important in themselves, but thev are of vital impor- 
tance in the whole process. If there is a stoppage of work in one point, 
the whole process is stopped. We had to meet that condition. So, in order 
to handle that situation and prevent stoppages and labor trouble of that kind, 
and keep the machinery going, a labor deoartment was organized. That 
simply means that there shall be in the business a department which shall 

108 



.The Importance of the Human Factor in Industrial Preparedness 1 

be sensitive, more sensitive than the management can be, interested as it 
always is, of course, in efficiency and getting out the product, but a depart- 
ment which will primarily be sensitive to what is going on, and shall advise 
the management as to what is in the minds of the people, and shall forestall, 
if possible, any gathering storm, anything that is likely to cause a disturb- 
ance, and make suggestions as to the management, the acts of the manage- 
ment, so that the administration can be modified to avoid troubles. Then 
later on this department had to take the responsibility of representing the 
company before the board of arbitration, take its place in the government of 
the business. 

Two arbitrators were chosen, one by each side, and because of the dif- 
ficulty in getting the third man — we spent a long time at this, the people 
had been promised arbitration and the matter had been delayed for a num- 
ber of weeks — we decided we would try what two men meeting together 
could do, and because the heat of conflict had been over for some time, peo- 
ple had gone back to work and were very busy, giving no thought to the 
trouble which caused the strike, and everybody feeling quite happy, these 
two men were able to agree perfectly on every point that was presented, 
and an agreement was drawn up, in order to provide, if any friction should 
arise in the future, that they should hear all the complaints that might come 
up, thus constituting themselves, without their knowledge at that time, a 
permanent board of arbitration, which developed later into the form in which 
we have it now. 

It soon became apparent that they couldn't hear all the complaints 
which came up. The complaints were largely petty. They were not pre- 
sented in any very elaborate form. They were simply registering the ob- 
jections of some people to certain things which were happening, and it took 
a long time to hear them, and so machinery had to be devised to relieve the 
board from this tedious function. So after choosing a third member of the 
board and making it a court of apeals, we constituted another body, called 
our trade board, which should have original jurisdiction in all complaints 
arising, and only the cases involving some substantial matter or questions 
of principle should be referred to the board of arbitration, and that has 
worked very well to this day. 

Now, he essential feature of the plan at the present time is that neither 
the company nor the labor unions dominate ; that the final authority, the 
final direction in matters in which there is liable to be disputes, is given to 
our board of arbtiration, and they represent the final authority. Of course, 
they are subject to the constitution or agreement which we operate under. 
The written agreement runs for three years. It happens to run for three 
years each time. We renewed it last May. It was the second renewal, and 
this lays down the fundamental principles under which we operate, and 
which the board interprets to both sides, and we all submit to it. 

That gives us an opportunity to say to the employes, "The rules under 
which you are working, the conditions under which you are working are just 
as much of your own making as they are of the company's making. There- 
fore, you owe as much loyalty to them and the observance of them in good 
faith, as the company does. If the company sets the example of yielding 

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Western Efficiency Society Conference 



whenever a decision goes against them, of submitting to all these rules, no 
matter how it may interfere with the spirit of the business, you ought to do 
as much/' That, I believe, has a very good effect. It certainly has upon 
the leaders who represent them. There is a certain responsibility placed 
upon them, which makes them quite conservative in a way, because they 
wish to get a reputation for acting in good faith. 

The machinery of complaints is something like this : Whenever an 
administrative act of any sort is inaugurated by any official of the Company, 
no matter how minor he may be in any of our plants, the people have a 
right to make a complaint. They have a right to make a complaint about 
any change which may arise in the shop, of any kind whatsoever. These 
complaints are made to the representatives, and the representatives present 
them to the labor department, and here they get their first sifting out. 
Whatever adjustments can be made there are made, and the labor depart- 
ment has the authority to carry them out. Of course they have all the deci- 
sions of these Boards to work under. They have the agreement, and it is 
the duty of the labor department to apply it to his particular case. In case 
the two dispute, and can't agree, the matter is then by mutual agreement 
taken to the trade board. There a hearing is had, presided over by a neutral 
man from the outside, and he gives a decision. Either side have the right 
to appeal from that to the Board of Arbitration. An appeal creates an occa- 
sion for laying down new principles or for corroborating old ones, and thus 
we are perfecting the instrument all the time. In the matter of prices for 
piece work where there is trouble, we have created machinery by which this 
same neutral Chaiman of the Trade Board officiates as the Chairman of the 
Committee, and all piece work prices are made by that committee. 

In the matter of discipline the system is this : The Company have the 
right of initiation of discipline of all sorts. That, however, is centralized, 
and in an efficiency society it is not necessary to say anything about the 
very great good effects which have come from centralized foremanship, 
especially the value of discipline that is all centered in the labor department. 
The officials of the Company who come in contact with the people who 
have to maintain discipline, have the right to suspend from the pay-roll any 
offender, but that suspension doesn't amount to a discharge ; it isn't so con- 
sidered. It puts the case up to the discipline official, and he makes a judg- 
ment. He has full power to suspend him if he sees fit. The appeal from 
him lies to this Trade Board, and another appeal if necessary to the Board 
of Arbitration. 

Further, through this course of what seems to be quite complicated ma- 
chinery, the matter of discipline is handled without creating unnecessary 
friction. This, after all, is one of the points at which there is usually great 
friction and great difficulty. It also has worked out so that the efficiency 
of the shop, the relations between the foremen and the small executive offi- 
cers who come in contact with people, is very much improved, because the 
foreman is no longer a disciplinary officer, and his relations to the people 
can be very much different than otherwise. 

There are a great many points, of course, which we had to work out, 
and a great many difficulties have been encountered, but so far they seem 

110 



The Importance of the Human Factor in Industrial Preparedness 

to have all been met very successfully by the system. The one thing over 
which we all rather congratulate ourselves is the development of certain 
leaders among the people. One I could mention who is now the Interna- 
tional President of all clothing workers' unions, who developed up under 
this plan, and who developed a great sense of responsibility and patience, 
and has set the example to all other minor leaders, which they try to follow ; 
the majority do. 

In order to get the full principle squarely before you, I have emphasized 
particularly how the administration of a large industrial plan is like a prob- 
lem of government, requiring all the principles of government to be brought 
in play, and requiring that all the forms of government shall be efficiently 
carried out. I can do no better, I think, than to review the preamble of our 
Agreement, which was written by the Chairman of our Board of Arbitration, 
and to my mind is a really classical statement of the purposes of such a 
society. 

(Mr. Howard then read the preamble of their agreement.) 

THE HART, SCHAFFNER & MARX LABOR AGREEMENT 

PREAMBLE. 

By Mr. J. E. Williams, 

Chairman of The Board of Arbitration. 

The parties whose names are signed hereto purpose entering into an 
agreement for collective bargaining with the intention of agreeing on wage 
and working conditions and to provide a method for adjusting any differ- 
ences that may arise during the term of this contract. 

In order that those who have to interpret this instrument may have 
some guide as to the intentions and expectations of the parties when enter- 
ing into this compact, they herewith make record of their spirit and purpose, 
their hope and expectations, so far as they are now able to forecast or state 
them. y LI i 

On the part of the employer it is the intention and expectation that this 
compact of peace will result in the establishment and maintenance of a high 
order of discipline and efficiency by the willing co-operation of union and 
workers rather than by the old method of surveillance and coercion ; that by 
the exercise of this discipline all stoppages and interruptions of work, and 
all wilful violations of rules will cease; that good standards of workmanship 
and conduct will be maintained and a proper quantity, quality and cost of 
production will be assured; and that out of its operation will issue such 
co-operation and good will between employers, foremen, union and workers 
as will prevent misunderstanding and friction and make for good team work, 
good business, mutual advantage and mutual respect. 

On the part of the union it is the intention and expectation that this 
compact will, with the co-operation of the employer, operate in such a way 
as to maintain, strengthen, and solidify its organization, so that it may be 
made strong enough, and efficient enough, to co-operate as contemplated in 
the preceding paragraph ; and also that it may be strong enough to corn- 
Ill 



The Importance of the Human Factor in Industrial Preparedness 



mand the respect of the employer without being forced to resort to militant 
or unfriendly measures. 

On the part of the workers it is the intention and expectation that they 
pass from the status of Avage servants, with no claim on the employer save 
his economic need, to that of self-respecting parties to an agreement which 
they have had an equal part with him in making; that this status gives them 
an assurance of fair and just treatment and protects them against injustice 
or oppression of those who may have been placed in authority over them; 
that they will have recourse to a court, in the creation of which their votes 
were equally potent with that of the employer, in which all their grievances 
may be heard, and all their claims adjudicated; that all changes during the 
life of the pact shall be subject to the approval of an impartial tribunal, and 
that wages and working conditions shall not fall below the level provided for 
in the agreement. 

The parties to this pact realize that the interests sought to be reconciled 
herein will tend to pull apart, but they enter it in the faith that by the exer- 
cise of the co-operative and constructive spirit it will be possible to bring 
and keep them together. This will involve as an indispensable prerequisite 
the total suppression of the militant spirit by both parties and the develop- 
ment of reason instead of force as the rule of action. It will require also 
mutual consideration and concession, a willingness on the part of each party 
to regard and serve the interests of the other, so far as it can be done with- 
out too great a sacrifice of principle or interest. With this attitude assured 
it is believed no differences can arise which the joint tribunal cannot mediate 
and resolve in the interest of co-operation and harmony. (Applause.) 

CHAIRMAN SIMONS : The next speaker on the program, Mr. Mag- 
nus Alexander, was to talk to you on the subject of "Labor Turnover." It 
speaks very well for the general state of preparedness of the Western Effi- 
ciency Society that we are able to substitute on very short notice, in the 
unavoidable absence of Mr. Alexander, another speaker in whom you will 
not be disappointed. No formal introduction is necessary. Mr. Berndt's 
paper deals with the same topic covered by Mr. Alexander, "Labor Turn- 
Over." I feel that we are very, very fortunate indeed in being able to 
have Mr. Berndt to present this subject. 

MR. IRVING A. BERNDT: Mr. Chairman, Members of the Western 
Efficiency Society, Ladies and Gentlemen : I sincerely regret that Mr. Alex- 
ander is not with us and more sincerely that I have been offered as a sub- 
stitute. I could hardly be so ambitious as to make up for his loss in this 
program. 

This paper was written some time ago, and while it is entitled "Labor 
Turn-Over," probably should more satisfactory be entitled "Factors Influ- 
encing Labor Turn-Over." (Applause.) 



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Western Efficiency Society Conference 



FACTORS INFLUENCING LABOR TURN-OVER. 

I. A. Berndt, 

Manager Betterment Department, Joseph T. Ryerson & Son. 

Time was when a new man was hired by the beckoning motion of the 
foreman's hand. He had a job. And he was fired by a scornful glance 
from that foreman. He had no job. 

Under such conditions a new man was considered even less than a new 
machine. At the risk of repetition I will again use a simile which I have 
used many times before, but which I have not been able to improve upon, 
i.e., the new man and the new machine. A machine costing $1,500 was sel- 
dom bought without at least some consideration, without looking into quali- 
fications as compared with requirements and without decision by the best 
intelligence in the organization. The new man who was so quickly, easily, 
and unceremoniously chosen, if employed for a year, or two at most, would 
represent the same investment, with the possible exception that payment was 
made in weekly or bi-monthly installments. 

Then why the difference? May I suggest it? The machine, if it did not 
fit, was a white elephant, a burden, could not easily be unloaded. The man, 
if he did not fit — and how many did not, how many were unjustly considered 
unfit — could be dropped at a minute's notice. No loss, no responsibility; 
just another man to be fired. 

We have been warned that it was dangerous and unjust to make a 
machine of the man. 

I wish to say that it were far more just and fair to the man had he been 
considered even as much as a machine under that regime. 

And after the man had entered the plant or factory, what was his fate? 
Only this, he must work out his own salvation. He carried the entire re- 
sponsibility of his current productivity and welfare, as well as his future 
progress. '! ■] || :0 'H 

If he did not have the ability and qualifications it was assumed he did 
have, it was his fault. If he was physically or mentally unfit for the job, 
he and his alone must suffer. 

If conditions were detrimental to his health and safety, it was, as many 
of us have heard stated not so very many years ago, his "own funeral." 

As to his actual work, efficiency, and production, here again he carried 
the entire responsibility. The equipment and facilities he used were pro- 
vided, it is true, but with little or no consideration as to their adaptability to 
his peculiar requirement. 

Methods he used and applied were those he brought with him, which 
had been handed down to him by his forefathers — unscientific, laborsome, 
fatiguing rule of thumb methods, in great numbers of cases harmful to his 
health and body, to his intelligence and development, and certainly detri- 
mental to his productivity and highest efficiency. 

He might, of course, in his travels from one plant or factory to another, 
pick up a good point here and there. This was the long drawn-out process 

114 



The Importance of the Human Factor in Industrial Preparedness 



of what was termed "getting his experience." His employer, however, rarely 
took great interest in this. 

Average conditions surrounding production were what would naturally 
follow a combination of a passive interest and acceptance of available equip- 
ment and an uninterested acceptance of such workmen as offered themselves, 
their inherited and unstudied methods and even their own tools in most 
cases. 

In other words, it was the following of the line of least resistance. Lit- 
tle initiative on the part of the employer, and only a limited opportunity for 
the employee to improve his condition. 

It is true that where day wages were paid, the immediate financial loss 
was wholly the employer's and the employee suffered only insofar as the 
limitations to possibilities of increased earnings. However, even in this 
respect, we all know of the arbitrary piece rate methods of wage payment, 
which made the employee carry the burden of all losses due to inefficiencies 
of all kinds inasmuch as he was paid only for what he produced. 

My description of conditions in those days may be criticized as exag- 
gerated. While granting that there were exceptions I believe you will agree 
with me that they were in the very smallest minority, and even in this day 
of enlightenment in industrial activities there are plenty and more of such 
conditions to be found. 

I have painted this picture in deep colors intentionally so that the con- 
trast may be more striking. 

Is it any wonder, then, that where the above description more or less 
correctly fits the case, that the labor turn-over percentages should be so 
great? . \\ \ . . ! j i y, [] [jiH 

Is it not logical and understandable that literally dozens of men and 
from that down to at least three, were employed annually for each man 
retained on the regular payroll? 

I see nothing in such management which would encourage and foster 
loyalty in the employee or even more than a passing interest in his work. 
I see no reason why men working under these conditions should remain long 
in one organization. His progression could seldom be within an organiza- 
tion. It must be through moving from one place to another, either through 
force of circumstances or because of the natural desire to improve" his con- 
dition with which most humans are imbued. 

In other words, he had little opportunity or encouragement to improve 
himself in a single organization, so he must try this, that, or the next, start- 
ing anew, over and over again until he either very accidentally found his 
vocation, or unfortunately either because of age, loss of ambition, confidence 
or faith, or a hopelessly soured nature, he found a rut and remained there 
forever and ever. Had there not been many of the latter type, the labor 
turn-over percentage would have been even greater than it was. 

And now, before leaving this rather depressing consideration of what 
was, I wish in passing to say a word of appreciation in which I know you 
will all join me, of those men who, under the conditions described, did not 
fall into the rut, and wmo rose, through their own strength of character 
and will, from the ranks ; who are even now employing and handling the 

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Western Efficiency Society Conference 



laborer to whose number they once belonged. I believe they are to be com- 
mended and deserve great credit. They did it with the odds against them. 
They were supermen. 

it would be difficult to say just how far back the birth of the new indus- 
trial day may be dated, but it certainly had not attained even a measurable 
growth until some time during the last ten years. 

It would also be difficult to say accurately just who fathered this new 
reorganization. Surely no one individual. The problem was and is so big 
that it certainly could not be within the scope, intelligence or time of any one 
man to soive it completely, alone. 

I believe that various individuals have approached various angles of the 
problem, each in his own way, and it has been largely due to the efforts of 
such organizations as this, and the activities and interest of its members, 
that we are finding a new intelligence and appreciation regarding the labor 
problem in industry today. 

Certain it is, of course, that there stands out in this work many names 
of men deserving of credit for their particular efforts and far-sighted appli- 
cation of wisdom to this important problem. I regret that time does not per- 
mit me to list these names and their creditable additions to industrial prog- 
ress. I know that many names of those present would be included in such 
a list. 

The solution of the labor turn-over problem, I believe, revolves around 
certain broad movements and developments in industrial affairs which, if 
they did not receive their start during the last ten years, have certainly 
gained impetus and recognition during that period, which made for a devel- 
opment far greater than during any similar period, and which is responsible 
for the present-day improvements in industry and manufacture. 

Let us consider them in turn : 

1st. The careful, analytical, and scientific selection of employees, in- 
cluding character analysis and the application of psychology to this problem. 

2d. The movement for efficiency and the development of what is known 
as Scientific Management in business. 

3d. The Welfare and Sociological work. 

4th. The Safety movement, including also the Health and Sanitation 
propaganda. 

5th. The corporation, industrial and apprentice school movement. 

Each one of these movements and all groups and individuals interested 
in them have seen and studied a different feature of the man problem. 

Naturally in many cases their work has overlapped, but for the main, 
each division has specialized on certain definite aspects of the problem. 

Naturally, too, they have each felt the importance of their interests and 
may have even become imbued with the feeling that their particular work 
was most and alone important. 

However, are not their interests common? Are we not all engaged in a 
larger sense in an attempt to understand the man, his qualifications, his 
interests, requirements and welfare? 

Let us consider these different movements and their developments sep- 
arately. 

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The Importance of the Human Factor in Industrial Preparedness 

First, the proper selection of employees. It would be difficult to say 
what influenced employers most in their acceptance and recognition of this 
worthy work. 

We know that the results of researches and investigations time after 
time have proven that it costs in dollars and cents anywhere from $10 to 
$300 to hire and fire a man. We know that these researches have pointed 
out that there was a money loss caused by unintelligent selection due to : 

1. Cost of hiring; 

2. Cost of training; 

3. Reduced production during training period ; 

4. Impaired quality during training period ; 
and many other factors. 

We know, too, that it has been advocated and agreed that the employer, 
in hiring a man, accepts a definite responsibility to that man as well as to 
the community as a whole. He must not take a man's time unless he knows 
that man is qualified and competent to do his best work in the vocation and 
job for which he is selected. The man must not be permitted to get into a 
rut. He must progress and develop. The community must not be bur- 
dened with discouraged and incompetent individuals, unable to earn even a 
livelihood and without faith in God or man. 

The psychologists have pointed out that man's mental characteristics 
vary widely and that until you have matched the individuals having certain 
qualifications in that direction with vocations and jobs requiring such quali- 
fications you will not have done right by either him or his employers. 

Those advocating character analysis have at least interested the employer 
in their arguments that various men have varying physical indications which 
can be analyzed to great advantage in studying a man's character and to 
help fit him to a job in which he can make a satisfactory progress. It is 
pointed out that a man must be happy in his work. 

As stated before, it is very difficult to say just which of these arguments 
have convinced the employers of labor most. Probably not any one in all 
cases, and no doubt a combination of all in most cases. 

Suffice it to say, however, that we do find, not only an interest, but a 
definite activity in this work as evidenced by the many organizations of all 
sizes and kinds which are giving this feature attention all over the country. 
In Chicago it is especially evidenced by the Employment Advisers' Asso- 
ciation. 

The success of this work has been proven time after time. We read and 
are told day after day of the results, and w r e do not find organizations revert- 
ing to the old hit or miss methods once they have started to consider the 
careful selection of men. 

Let us consider the efficiency movement. How has it affected Labor 
Turn-Over? What particular aspects does it study? 

In my understanding it attempts to analyze the job to be done, the work 
to be performed, and the equipment and methods which are being used. It 
attempts to improve the methods and conditions of work as well as the 
equipment and tools used so that the work can be done by the man with less 

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Western Efficiency Society Conference 



effort and fatigue and in less time. Its ambition is to make work agreeable 
to each workman. 

It attempts to standardize practices and methods so that the qualifica- 
tions required in a man for a job can be given to the employment depart- 
ment for use in selecting the right man for the job. 

It offers the standard practices for use in educating and training men to 
do work in the best way according to best practices. Also for use in educat- 
ing men for advanced positions. It advocates the employers' acceptance of 
the responsibility to teach men these best practices, finding them for him 
and making it unnecessary for him to go from one shop to another to pick 
them up himself. 

It standardizes quantity and time of production so that the men can be 
paid an equitable wage, each one according to his individual effort. 

It provides for an accurate recording of costs of production so that 
each workman's activity can be fairly judged. 

It advocates the employers' acceptance of all responsibility as to ascer- 
taining and following best show practices and systems, such as planning 
work to be performed, routing material and jobs correctly so as to eliminate 
delays, etc. The employee no longer is burdened by this responsibility. 

It lifts the burden of these responsibilities from the shoulders of the 
workman and places it upon those of his employer, where it properly and 
more effectually belongs. 

There are, of course, excellent and convincing arguments in favor of 
this work, both from the aspect of financial return and the justice of it to 
industrial workers. 

Here again there is uncertainty as to just which arguments have gotten 
for it the most recognition. It is obvious that it is fundamentally based on 
righteousness and that it pays. 

It is with great pleasure that I record an impression that the future suc- 
cess of this work lies, not so much in influencing and educating the employer 
and manager of labor to accept it, as in the study and standardization of the 
processes with which it is to be accomplished. 

It seems hardly necessary to say more than a word about the effect of 
scientific. management on labor turn-over. The results are so logical. If a 
workman has been fitted to a job requiring known qualifications which he 
has ; if he is trained and assisted to do the work according to the best known 
processes ; if equipment and facilities are provided which have been selected 
with a view toward decreasing the fatigue usually resulting from the per- 
formance of his duties ; if there is known and in effect an equitable basis for 
wage payment which pays him for his own individual efforts ; if efforts are 
made to remove all delays or obstacles standing in the way of his largest 
production ; if he is given every incentive, opportunity, and inspiration to 
do greater and better work; if adequate records of his performances are 
available so that he is assured that he will not be judged unintelligently ; if 
he has the confidence that his employer, through studies and researches in 
efficiency, offers him opportunities to use practices and equipment in his 
work as good as, if not better than, he could find in other organizations ; if 

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The Importance of the Human Factor in Industrial Preparedness 

all this has been done, what excuse does he have for changing his employ- 
ment? There are few plausible reasons remaining. 

And now a word about welfare and sociological work. It has been 
found that before we can really understand the workman, we must appreci- 
ate his problems of life. We must understand his viewpoint and know his 
environments. It has been found that the efficient workman is he who is 
satisfied, happy, and not distracted by disturbing worries and troubles 
resulting from lack of opportunity and training in principles of right living. 

This movement advocates that the employer should take the responsi- 
bility of study and research in this field and give his employee the benefit 
of a service which will tend to inspire and help him to enjoy the better 
things in life. 

It may not be universally accepted as necessary or effective and may 
never be considered as practical in some cases, but it is being followed and 
successfully developed in so many organizations, particularly the larger 
ones, that it certainly can no longer be considered an experiment. 

Its effect on labor turn-over is evident. Most of a workman's outside 
interests have to do with community affairs. If they are agreeable he will 
have no incentive to move from one section to another, which continuous 
moving is in itself one of the great disturbing elements entering into this 
problem. 

Closely associated with welfare work is the important Safety and Health 
propaganda. 

This movement proposes briefly that the employer employ only safe 
men and men physically fit to do the work for which they are employed, 
and after they have been employed, to take full responsibility for keeping 
them safe and sound in body and limb and at least as healthy and physically 
fit as when they entered his employ, if not more so. 

It insists that the employer must provide safeguards on equipment, 
safe and sanitary working conditions, that he must educate the man to think 
safety and to work safely, that he must examine a workman's condition of 
health when employed so that he may not be put at work which will aggra- 
vate some existing illnesses, and that after he is employed he must have 
medical supervision to keep him well. 

To ascertain the success of this work, one need only to look around on 
all sides and see the popular sentiment in favor of "Safety First." To study 
it further, one might read into the records of the great National Safety 
Council and learn of its four years of. creditable work, as well as the activi- 
ties of its 2,500 and some odd members all over the country. This speaks 
for itself. 

Need I say much about the effect of this work on labor turn-over? A 
man should and will prefer to work where conditions are safe and healthful. 

His employer must have the satisfaction not only of the knowledge of 
having performed a work worthy of his best efforts, i. e., the conservation 
of life, but he finds it is a good investment as well. 

Looking further, into the future, corporation schools, vocational and 
industrial apprentice schools, are attempting to prevent the misfitsin indus- 
try are proposing to equip the young man early in life with a training which 

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Western Efficiency Society Conference 



will fit him to perform that work for which he is best suited, most effectu- 
ally. 

Those who are behind this movement, enthusiastically urge that em- 
ployers must in all justice accept this responsibility in anticipation of im- 
proved conditions in industry in the future. 

This work is also more than experimental, as evidenced by the results 
of those pioneers who have proven that it is not only worthy and right to 
train the young man who is to be the worker of tomorrow, but that it pays 
in dollars and cents both him and his employer. 

Its effect on labor turn-over must be apparent. Our average American 
workman is eager to learn and he will go and remain there where he can not 
only receive his industrial education, but use it to best advantage to earn his 
living. 

And now to summarize our consideration of these five movements which 
are today each one having a telling effect on labor turn-over percentages, 
may we not truthfully say we are fast approaching- a much-to-be-desired 
improved industrial day with all responsibilities where they belong, not only 
because of honest conviction that it is just and proper, but because it is 
based on sound economic condition in business? 

If there ever was truth in the statements that business and industry are 
heartless and without soul, are not those who are conscientiously promoting 
these various activities putting a heart and even a soul into it? Let us 
glory in the work. 

If all the developments mentioned in the foregoing are accurately de- 
scribed, and if their success has been effectually- demonstrated, one might 
well inquire what remains to be done? What progress will industrial his- 
tory record during the next ten years? 

First, let me suggest that while all the various movements mentioned 
have each had sufficient trials to prove their worth and to establish them so 
firmly in the industry that their permanency cannot be questioned, not any 
one can be yet considered as universally adopted. There is a large field still 
to be covered. Nor can we say truthfully that all employers have adopted 
even one of these measures in an attempt to prevent excessive labor turn- 
over. 

There are in proportion but a very few employers who have adopted all 
of these recommendations and accepted the responsibilities which go with 
them. 

Progress during the next ten years will demand education by each group 
and by all groups on even a more aggressive program than in the past. 
Competition will give effectual assistance in this respect. 

Successful education will require something more which I look for in 
the next ten-year period. This is the standardization of those methods and 
principles underlying them, which are to be used in the study and execution 
of these various processes to be most effectual. 

Each one of these movements is so comparativelv new that there is 
very little agreement as to how thev can each one be be^-t worked out under 
all conditions. In fact, not enough consideration has been given this fea- 

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The Importance of the Human Factor in Industrial Preparedness 

ture, probably because of the fact that it has taken up so much time to 
work out the individual case that no time was left for standardization. 

However, we know that the time for this work has arrived and it is 
already receiving considerable attention, as is proven by the existence of 
this organization, the Western Efficiency Society and other similar organi- 
zations, the National Safety Council, the National Corporation School Asso- 
ciation, etc. 

This will probably do more than any other one thing to influence the 
universal adoption of these propagandas. It is hardly logical that employ- 
ers will wholly and fully accept these principles until those who advocate 
them are themselves agreed to definite laws and statements of object as well 
as more or less standardized methods of applying these laws and attaining 
the results desired. 

Then, too, I believe there is a great need of co-ordination of all the work 
of all five of the groups discussed. 

To my mind several things are evident in this connection. They all 
have a common interest, the industrial worker and his progress. 

They obtain at least one common result, the reduction of excessive 
labor turn-over as here discussed. 

They must overlap in their work, and certainly much duplication has 
occurred requiring time which could be put to better use in further develop- 
ment of one or the other. 

Facts developed by one group simplify the work of others. 

Most satisfactory industrial conditions and lowest possible labor turn- 
over percentages cannot exist until, as far as practical and possible, all these 
features have been considered. No one is wholly effectual and it would be 
difficult to say that one of these movements is more important than all of 
the others. These are my arguments in favor of co-ordination and co-op- 
eration among these five groups of propagandists. 

Summarizing them, if not my prophecy, at least my hope is that labor 
turn-over will be reduced, if not to a theoretical minimum, at least to a prac- 
tical one, because : 

1. The great majority of employers will have been influenced to recog- 
nize the study of the industrial worker as a problem and a responsibility 
which has to do with another problem in which he will learn to be inter- 
ested — labor turn-over. 

2. The sponsors of those various movements which are even now so 
successfully studying and solving this problem, will have standardized their 
own principles, laws and methods, and will offer the employer a definite 
program to follow in his study and solution of this problem. This in itself 
will have much to do with convincing- the skeptical. Competition — seeing 
the other fellow work it out successfully, — will also do its share. 

3. The five groups now so actively engaged in this all-imoortant work 
will ioin forces, in some organized way will co-operate and will be co-ordi- 
nated, realizing their common interests and common object. They will do 
this, realizing that where one is, all the others must be, in a lesser or a 
larger degree, deoending upon possibility of Dractical application. 

These in their broadest aspects are my sincere hopes for the common 

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Western Efficiency Society Conference 



interests of the industrial worker and his employer during the years next to 
come. 

The present national crisis, when all of our labor resources must be 
mobilized and conserved, will, I believe, bring these conditions many years 
nearer and will force upon employers a national appreciation of their 
necessity. 

The meeting is adjourned. 






122 



FIFTH SESSION 

Thursday Evening, May 24, 1917. 



Mr Irving A. Berndt, Chairman. 

MR. BERNDT: Ladies and Gentlemen — We are at this conference 
considering a very important problem, that of the human factor in indus- 
trial preparedness. This would be no real conference if we did not consider 
at at least one of our meetings, and more if we have time, labor's viewpoint. 
We ought, if we are to make this the real consideration, have a complete 
discussion on the subject. Tonight we are devoting the entire time to that 
one subject and the speaker we have chosen to present the matter to us is 
the man who is best fitted to present Labor's Viewpoint; a man who is 
respected by every factor in industry today and whose views we all look up 
to, Mr. John P. Frey. Mr. Frey, who is the editor of the International 
Union Molders' Journal, is a man whom we are glad to have with us tonight. 
He has the confidence of organized labor of the United States, as indicated 
in the fact that he is a member of the executive committee of the Ameri- 
can Federation of Labor; he has had the confidence of the United States 
Government from the fact that he was a co-worker with Professor Hoxie 
on the Industrial Labor Committee which was appointed by the Govern- 
ment; he has the confidence of those who are here tonight representing the 
scientific management of large industrial concerns, and I take extreme pleas- 
ure and think it is a distinct privilege that I have in presenting Mr. John 
P. Frey. (Applause.) 

MR. FREY: Ladies and Gentlemen and Members of the Western 
Efficiency Society: Before I begin I want to make a confession: I am 
going to inflict a paper on you this evening instead of having the privilege 
of getting that encouragement and that inspiration that would come from 
watching your countenances as I would addressing you. That is one thing 
that I will lose. I think, however, I may be a gainer in this, that having to 
read my paper and watch the words I will not be able to discover a period 
in my address when you are all becoming so fatigued that you are wishing: 
for me to bring it to a hurried close, so there might be advantages after all 
in reading. My principal purpose in preparing the thoughts that I wanted 
to bring to your mind and presenting such facts as I had at my disposal was 
to lose as little time as possible in getting before the meeting that which I 
desire to present. 

I was very much interested in one of the things which the Chairman 
just said, namely, that it was well that labor should be here in connection 
with this question of production. This country now faces an entirely dif- 

123 





• 






sir * \ 






JOHN P. FREY 





The Importance of the Human Factor in Industrial Preparedness 

ferent problem than it has ever faced before. It is beginning- to take up 
the problem that has been the most serious one for all of the European 
countries to solve, the problem of production, the problem of what labor 
will do in the maintenance of our armies. We have found that the labor 
problem is as important as the military problem and it was not until much 
blundering and much loss of valuable time that certain fundamental truths 
were discovered. I hope in the course of the evening to call some of those 
truths to your attention. The problem of the human factor in industrial 
preparedness is one of the most vital to the nation's welfare which can be 
considered at this time. 



LABOR AND INDUSTRIAL PREPAREDNESS. 
By John P. Frey. 

The problem of the human factor in industrial preparedness is one of 
the most vital to the nation's welfare which can be considered at this time. 

A few years ago the wooden man-of-war was equipped with bronze or 
cast-iron cannon, smooth bore and firing round balls. The sailors were 
armed with pikes, cutlasses and pistols. Today the steel battleship is a 
massive floating machine shop and fortress. Its armament required an army 
of mechanics to produce, the firing of a single broadside has required greater 
industrial production than was entailed a few years ago for the arming and 
munitioning of a fleet. 

The soldiers in our earlier wars carried their cartridge factory with 
them in the lead bar, bullet mold, and powder horn. The modern high-pow- 
ered rifle and machine gun has introduced entirely new demands, requiring 
greatly increased production. 

Field artillery has been revolutionized, huge transportation facilities are 
now required to munition an army in the field. Today, the army must be 
carried upon the shoulders of a vast number of industrial workers. 

The European war has given a tremendous emphasis to the fact that the 
structure of military preparedness under modern methods of warfare rests 
largely upon a foundation of industrial preparedness. Unless there is indus- 
trial efficiency first, modern military efficiency cannot be developed. The 
industrial workers' capacity for production and their co-operation with the 
forces upon the battle-field have become the factor which very largely deter- 
mines an army's effectiveness. Munitions have become as important as sol- 
diers, and the production of these munitions today requires the service of an 
enormous army of skilled and willing industrial workers. 

There are three major problems to be solved, if the workers are to con- 
tribute the largest degree of assistance to the nation's defense. These are 
the maintenance of the workers' physical and nervous strength, the devel- 
opment of their skill as craftsmen and industrial workers, and the estab- 
lishing of those conditions which will enable them to co-operate most effect- 
ively with each other and with their employers. 

One of the first steps taken with the military recruits is to strengthen 

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Western Efficiency Society Conference 



them physically. Wholesome food in necessary quantities is supplied, suf- 
ficient exercise to harden their body is provided, and compulsory rest from 
"lights out" in the evening to "reveille" in the morning is maintained, so 
that the recruits may be brought up to the highest degree of physical effi- 
ciency. It is recognized that insufficient food, over-exertion, or insufficient 
rest, would unfit the soldiers for the physical exertions which they must be 
called upon to perform in the course of their duties. 

Enlistment in our army and navy will draw heavily upon the mass of 
our industrial workers, so that those who remain will be called upon to 
produce in larger quantities than before. 

If this additional production is to be secured, is it not apparent that 
these industrial workers must have their bodies so nourished, protected from 
physical or nervous overstrain, and given sufficient rest, that they may be 
physically fit to perform their tasks? 

The scientific investigations which have been made in this country and 
abroad have amply indicated that the workers' physical and mental effi- 
ciency is based primarily upon the quality and quantity of their food, the 
degree of physical and nervous strain entailed by the character of their 
labor, the sanitary conditions surrounding their place of employment, and 
the comfort and opportunities for rest provided by their homes. 

Fortunately we now have at our disposal the most valuable data con- 
cerning the question of the workers' efficiency during war time which has 
been prepared. 

For reasons, which it is unnecessary to analyze at this time, the indus- 
trial managers of Great Britain entered into the production of war muni- 
tions without the ordinary regulations of factory legislation or trade-union 
rules. The hours of labor were lengthened, in many establishments Sunday 
work became the rule. Wages did not keep pace with the rapid increase of 
the cost of the necessities of life, so that a condition of undernourishment 
existed in more than one locality. 

The lofty appeal of patriotism was the stimulus applied to secure the 
worker's consent to work long hours at high speed. But it was not long 
before it became apparent that all was not well in the industries. Not only 
were the workers manifesting a rebellious spirit against the industrial con- 
ditions which were being forced upon them, resulting in a reduction in the 
spirit of co-operation on their part, but it was becoming evident that their 
physical standards were being jeopardized, to the injury of industry itself as 
well as the workers' physical well-being. 

So serious did the problem become, that a Health of Munition Work- 
ers Committee was appointed by the Minister of Munitions in the middle of 
September, 1915, whose duty it was to consider and advise on questions of 
industrial fatigue, hours of labor and other matters affecting the personal 
health and physical efficiency of the workers in munition factories and work- 
shops. Since that date this committee has published fifteen memoranda 
dealing with one or more of the subjects which had been entrusted to it. 

These reports contain information of a vital character which we must 
study and apply if we are to avoid the serious and almost fatal mistakes 
which occurred in British industries since the European war began. 

126 



The Importance of the Human Factor in Industrial Preparedness 

In summarizing upon industrial fatigue and its causes (Memorandum 
No. 7) their report reads in part : 

"The committee are bound to record their impression that the muni- 
tion workers in general have been allowed to reach a state of reduced effi- 
ciency and lowered health which might have been avoided without reduc- 
tion of output by attention to the details of daily and weekly rests." 

It was found that lengthening the hours of labor had resulted in reduced 
efficiency caused by muscular and nervous exhaustion. Briefly, the objec- 
tions to overtime were found to be that : 

1. It is liable to impose too severe a strain on the workers. Many wit- 
nesses assert that while for an emergency, overtime is effective, after a 
period the rate of production tends to decrease and the extra hours to pro- 
duce little or no additional output. Moreover the quality of the output may 
be adversely affected during the whole period of work and not only during 
the hours of overtime. 

2. It frequently results in a large amount of lost time. In part, this 
is to be attributed to the workers becoming exhausted and taking a rest, and 
also to sickness, noticeable chiefly among the older men and those of weak 
constitutions. 

3. It imposes a very serious strain upon the management, the execu- 
tive staff, and the foreman, both on account of the actual length of the 
hours worked and the increased work and anxiety to maintain output and 
quality of work. These men cannot take days off duty like the ordinary 
workers. 

4. It is liable to curtail unduly the period of rest and sleep available 
for those who have to travel long distances to and from their work, a mat- 
ter of special importance in the case of young persons. 

5. The fatigue entailed increases the temptation to men to the 
consumption of alcohol. They are too tired to eat and seek a stimulant. 

The question of output in relation to hours of labor was made a sub- 
ject of careful scientific investigation, with the result that the committee 
found that the total output increased as the hours of labor were reduced. 

In the case of one hundred women engaged on moderately heavy labor, 
it was found that, where the actual hours of work per week for a period of 
seven weeks averaged 68.2, the relative output per working hour was 100, 
while during a period of ten weeks with an average of hours of work of 59.7 
per week the relative output per working hour was 123. 

Commenting upon this table, the committee's report says : 

"The total output is 7,343 per week, or 8 per cent more than in the pre- 
Christmas period, in spite of the hours of labor being nominally 10.5 less, 
and actually 8.5 less." 

In a case of milling screw threads — labor of light character — it was 
found that the relative average hourly output of 100 for a week of 67.4 
hours rose to a relative average hourly output of 112 for a week of 59.8 
hours. In the instance of men employed in heavy labor, the sizing of fuse 
bodies, the relative hourly output of 100 for a 61.5-hour week was increased 
to a relative output of 124 for a 56.2-hour week. 

It was found that the excessive hours of labor had resulted in greatly 

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Western Efficiency Society Conference 



increasing the amount of time lost to recuperate and in sickness, and had 
also caused a staleness of the workers. By experienced managers and medi- 
cal officers, this condition of staleness is attributed almost wholly to the 
long hours and the deprivation of a weekly day of rest. 

Upon the question of industrial fatigue, the report says in part: 

"In the rapid enlargement and organization of munition factories in this 
country there has been, and is, the most urgent need for the application of 
the results of experience skillfully acquired. Upon a sudden national emer- 
gency the accumulation of fatigue and its results in workers might well be 
temporarily disregarded, but now, though the special need persists, the race 
is to be a long one, and a failure to conserve a maximum efficiency of the 
workers must be disadvantageous. Misguided efforts to stimulate workers 
to feverish activity in the supposed interests of the country are likely to be 
as damaging to the desired result as the cheers of partisans would be if they 
encouraged a long-distance runner to a futile sprint early in his race." 

In discussing the hours of labor and the question of fatigue, many, 
unfamiliar with modern methods of production, refer to the period when 
the manual worker labored from sunrise to sunset for a standard. 

To compare hours of labor under the old-fashioned hand method of 
production, or during the period when cumbersome and slow-moving ma- 
chinery was being introduced, with conditions as they exist today in indus- 
try, is as inappropriate and as misleading as a comparison between the 
highways used by our forefathers and those required today to sustain the 
wear and tear of modern vehicles upon the road-bed. 

The muscular and nervous strain upon the worker in the modern manu- 
facturing plant is much greater than under previous periods. The monoton- 
ous character of some of the work, the high speed of machinery, the burden 
placed upon each individual worker to maintain his share of the output so 
that a steady volume of gang production can be maintained, all tend to place 
a strain upon the worker which is more exhausting to his vitality than pre- 
vious methods of production. There was a time when the worker largely 
regulated the speed of the machine. Today, the machine is largely used to 
regulate the worker's speed. 

The old-fashioned idea that long hours of labor are productive of in- 
creased output must be set aside. The belief that long hours of labor 
increases the output has been shattered not only by the scientific investi- 
gator, but by the experience of the industrial establishments where the hours 
of labor have been shortened, the unfortunate fact being that in most in- 
stances a reduction in the hours of labor has come more as a result of labor's 
refusal to work longer hours, than from the enlightened knowledge of the 
employer upon the subject of hours of labor and production. 

The scientific data at our disposal, secured during peace times and since 
the subject has been studied in Great Britain during the war, indicates that 
the lengthening of the hours of labor created physical staleness among the 
workers, increased the amount of time lost for recuperation and through 
sickness, detrimentally affected the quality of the work, increased the 
amount of inspection required, and failed to secure the maximum production 
for a long period of time. 

128 



T he Importance of the Human Factor in Industrial Preparedness 

Unquestionably the worker's craft knowledge, his skill as a mechanic, 
his manual dexterity, plays an important part in production. 

The theory has been held by some industrial directors that the craft 
knowledge formerly so necessary to production is no longer essential under 
modern methods ot industry. They have nourished the belief that the part 
taken by machinery, the ability to specialize and subdivide, the work pre- 
sented by modern industrial plants, is such as to enable a small group of 
trained men to educate and direct practically unskilled labor, to such an 
extent that the old-fashioned craftsman is no longer required. This ten- 
dency to specialize as been one of the major causes which has led to the 
abandonment of apprenticeship upon a large scale, another cause being the 
employers' disinclination to be bothered with the education of apprentices 
and his belief that it was cheaper to secure his skilled workers from other 
manufacturers. 

It is a well-known fact that apprenticeship in the trades is becoming 
more and more a lost practice, and furthermore, where the term is still used 
the actual condition of the beginner is frequently not that of an apprentice 
in he old-fashioned sense of the term, but in many instances a young per- 
son, or an adult, who, under the impression that a trade is being taught to 
them, are employed upon simpler parts of the work during the period of 
so-called apprenticeship. As their output on this class of work is as large 
as the journeyman's and their wages considerably less, they are considered 
more profitable than journeymen would be. 

If the workers of our country are to produce efficiently during the war 
period it will be necessary to adopt every possible method to increase their 
craft knowledge and manual skill. 

Permit me to say in this connection that the technical skill of the effi- 
ciency expert and the overseer and the marvelous mechanical perfection of 
the machine cannot of themselves replace the worker's brain and render his 
craft knowledge unnecessary to efficient production. 

The workers are influenced by two forms of government : The first, the 
government by law which is established through the civil machinery of 
democracy, and the other, government in industry which largely establishes 
the relationship of employer and employee, and the conditions under which 
the workers' labor is to be given in exchange for the wages they receive. 
This form of government at the present time is sometimes absolute and 
autocratic or partially mutual and democratic. 

Our form of government as citizens is democratic. Our relationship 
as citizens is determined through the application of the principles of democ- 
racy. We live under democratically enacted laws, democratically adminis- 
tered. All of the glorious traditions of our country would inspire us to 
resist the reintroduction of the arbitrary and autocratic form. But in our 
industries the control is largely autocratic or absolute, except where the 
workers are organized and where through conferences with their employers 
they have entered into trade agreements; that is to say, where laws or rules 
governing the industry and affecting employer and employee alike have 
been entered into through the democratic methods of joint conference and 
collective agreements. 

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Western Efficiency Society Conference 



Because of a lack of democracy in the government which so largely 
regulates industry, there is suspicion, antagonism and conflict. 

Industry is frequently spoken of as a partnership between capital and 
labor, but if capital is to make all of the rules and labor accept them with- 
out question, the quality of partnership created is not calculated to bring 
satisfactory results to a majority of the partners. 

Where the employee is not consulted, where he is not allowed to have a 
voice in the determination of the conditions of labor and the terms of em- 
ployment, where he is expected to accept the dictum of a general manager 
or superintendent, is it surprising that this condition appeals to him as a 
practical application of the cats making laws for the mice? 

Autocracy or absolutism in the direction of industry cannot develop 
any better co-operation between the manager and employees than the same 
element in government can develop loyalty and co-operation between the 
autocrat and his helpless, voiceless subjects. 

The argument has been advanced by some serious thinkers and stu- 
dents of the problem, that if the workers were to be given a voice in deter- 
mining the conditions under which they are to be employed and the terms 
of their employment, successful industry would be impossible because, how- 
ever well-meaning, the workers are not sufficiently well-informed upon the 
problems affecting industry to safely permit of their participation in the 
determination of shop rules and regulations. 

The substance of this argument has been the one advanced by all of 
those defending the autocratic form of government. It has been the stock 
argument of those who have contended that the mass of people are not 
qualified to govern themselves but must be governed by the few who were 
born into this world for that purpose. 

There is a method which has been applied in the effort to establish a 
larger measure of justice and better co-operation in the industry. A few 
have believed that in arbitration the most advantageous medium for adjust- 
ing the relationship of employer and employee has been secured, but expe- 
rience does not bear out this expectation. Boards of Arbitration, whether 
purely voluntary, or partly or wholly compulsory, invariably acquire the 
court room atmosphere with the lawyer and the expert playing the same 
part which they do in the court room. 

The law may prevent neighbors from doing unlawful injury to each 
other's property, or from throwing bricks at each other, but it cannot make 
two neighbors treat each other with courtesy, decency and a fair regard for 
their mutual rights, neither can arbitration accomplish this, any more than 
arbitration could settle a dispute between autocrats and democrats in a coun- 
try where the authority of the one was a challenge to the other. 

The attempt to adjust industrial disputes through compulsory methods 
of arbitration has been given a thorough trial in Australia. This machinery 
for the adjustment of industrial problems had shown fatal weakness before 
the war. Since then the inherent fallacy upon which the system was 
founded has been made still more evident. 

In Europe, and in this country, we have witnessed the inconsistent atti- 
tude assumed by employers who organize themselves into associations with 

130 



The Importance of the Human Factor in Industrial Preparedness 

the object of preventing the enjoyment of a similar right on the part of their 
employees. They apparently believe that their own welfare depends upon 
maintaining autocratic direction over labor. They have failed to learn the 
lesson that intelligent human beings, regardless of the place they occupy in 
industry or in society, only submit to autocratic control so long as they are 
unable to escape from a condition which they believe unsound in theory, 
unjust in practice and detrimental to the best interests of all. This attitude 
is not peculiar to any one industry or country; it is encountered almost 
everywhere. 

The present national crisis calls for the most effective co-operation 
between the employer and the employee. The co-operation cannot be satis- 
factory if the conditions upon which it is based is the former one expressed 
by the term "master and servant." If there is to be co-operation there 
must be mutual consideration of the other's rights, a basis of understanding 
must be reached as a result of joint conferences, for co-operation cannot be 
created through the enforcement of arbitrary decisions, any more than the 
horse led to the water can be forced to drink. 

The nation is in urgent need at the present time of a constructive indus- 
trial program. No one man, or group, is sufficiently well-informed, or wise 
enough, to be clothed with full authority to determine the multitudinous 
questions which arise between employer and employee. It would seem in 
the light of experience that these questions can only be adequately adjusted 
through mutual discussion and agreement by the parties directly affected. 

THE CHAIRMAN : I am sure we all appreciate how fortunate we are 
in having Mr. Frey give us his version on labor's viewpoint, as he has pre- 
sented it to us tonight. In discussing this we invite visitors and members 
to join in the discussion and we particularly invite representatives of labor. 
The meeting is now open for discussion. Mr. Frey, I know, would be glad 
to answer questions. 

MR. HARRINGTON EMERSON: I agree so thoroughly fundamen- 
tally with the aims and ideas that Mr. Frey has presented to us that. I hesi- 
tate to utter any word or add any remarks. It was formerly my own con- 
viction that if the hours of labor were shortened the output would not be 
reduced. That is a belief that I was anxious to hold and I sought all pos- 
sible confirmation of that belief, and I do not hold it today on account of 
the number of demonstrations that have been given to me proving the con- 
trary. I therefore have abandoned entirely the advocacy of shorter hours 
on the ground that you can produce more in a shorter time than you can 
in a longer time, but I have preferred to take the higher ground that the 
man is not the mere beast of burden, not a machine that should be driven 
to the utmost of his capacity, irrespective of his welfare and of his position 
as a citizen. I take the ground that the reason we should advocate shorter 
hours — and I don't care personally how short they are made. In my own 
work I have always wished to leave the question of what we might call 
bonus to the men, to be taken either in the form of shorter hours, if he so 
elected, or of more money for the same day. I have advocated the question 
of shorter hours on the ground that we owed it to the man as a citizen and 
as the head of a family and that that was the strongest possible ground we 

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could take for shorter hours, and not from the fact that we think you can 
produce more if you work longer in the day rather than shorter. (Applause ) 
MR. HODGSON JOLLY: Mr. Chairman: I would like to ask Mr. 
Frey if the so-called failure of the arbitration question is not more or less 
attributive to the fact that Australia and New Zealand are the hot-beds of 
socialistic doctrine and not to the fact that there is anything wrong with 
the plan itself. I think that everyone agrees who knows economic condi- 
tions that Australia is the sole center of the socialistic movement outside of 
Germany. 

MR. FREY: I can only give my opinion, and that is the principle of 
arbitration is unsatisfactory and incompetent to solve most of the problems 
that arise. Occasionally it may act as a palliative, and that is all. The prin- 
ciple, I think, is unsound for this reason : When men allow outside author- 
ity to determine certain percentage or all of the matters in a joint bargain 
there is first of all the effort to use that Board of Arbitration to get the kind 
of award that you want, and both parties, if they have any skill in organiza- 
tion, endeavor first of all to have the board shape itself in their favor before 
arbitration begins. When an award is handed down those who feel that 
they did not receive all they were entitled to accept the award grudgingly, 
carry it out only so far as they are forced to and seek the first opportunity 
of overthrowing those portions of the award which are unsatisfactory to 
them, and for these reasons I think that the principle is unsound; that the 
sound principle to apply is that of genuine bargaining. Let's say that you 
own a "horse and you think the horse is worth $200; you want to sell it, I 
want to buy it ; I think the horse is not worth over $50. We will submit the 
question as to the value of that horse to some one who may be selected to 
set the price. The probabilities are that neither of us will be satisfied in 
the trade or in the price that is paid, but if we sit down together and finally 
agree upon a price ourselves then we both accept it, accept what we have 
agreed to, with an entirely different attitude towards each other in the bar- 
gain than as though outside authority had definitely said thus and so you 
must do. My own opinion is that the only value of arbitration, whether it 
is voluntary or compulsory, is to serve as a palliative, and I have had twenty 
years or more of practical experience in dealing with employers and workers. 

MR. J. S. BROWN: Is not most all of our trouble due to the fact that 
the manufactured article in a certain part of the country costs less than in 
in another, the labor, or rather the price of labor, is less or more than in 
other sections of the country and the empolyer meeting the competition with 
the person who has his article manufactured for less money than he is at a 
disadvantage in seeking the business on this particular article. Now, in an 
area like the United States, I speak from my standpoint, being in the 
tobacco and cigar business — cigars are made in certain sections at a less 
price than in other sections, and if that could be organized in some way it 
would be in the interest of the cigar maker. I don't know whether it would 
hold good in other lines, but I imagine it would, and that our great trouble 
lies in the fact that the employer getting into competition is injured for 
that reason. Something oug-ht to be done in that direction. 

MR. FREY: I can only say on that matter, that contrary to what 

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The Importance of the Human Factor in Industrial Preparedness 

would seem to be the facts in the case, my own observation have convinced 
me that the rate of wages paid and the hours of labor are the least instead 
of the greatest factors in the cost of production. 

MR. BROWN: This is piece work. 

MR. FREY : Well, even in piece work it is your overhead charges 
more than anything else. In the cigar business that may not be true, but in 
the industries that I am familiar with, the question of management and the 
overhead charges are far more important factors than the wages paid and 
the hours of labor. Take for instance two manuactturers paying the union 
scale of wage under the same business working conditions : one goes to the 
wall and the other declares a dividend of 27 per cent. 

MR. A. RUSSELL BOND: I would just like to speak a few minutes 
and give a little illustration which I think is pertinent and bearing on this 
very point. The other night it was my pleasure to speak to a body of 
manufacturers, most of them small manufacturers, some from Chicago and 
some from other towns around the states, and afterwards I was talking to 
one of the members. He said, "You know, it's a funny thing in doing busi- 
ness in Chicago where we have the strongest union to contend with ; have 
to pay the highest scale of wages, highest overcharges ; whenever we get 
into competition with fellows down the State, we can always beat them out 
in spite of the fact they work longer hours and pay lower wages." I have 
found out that the fact as stated by Mr. Frey — the manufacturers are too 
prone to think what the laborer gets in his envelope is the whole thing and 
I think one of the reasons for the long hours you find in some industries is 
the fact that the manufacturer is leaving too much to the time service 
department. In one factory with which I was connected for a time, in the 
course of some six years they went through a school of operation. The 
overhead charges of it were very heavy and I had the pleasure of seeing 
them work from two twelve-hour shifts down to four six-hour shifts, and 
from an output of twelve in twenty-four hours of the particular article to 
four an hour, or twenty-four in each six-hour shift, ninety-six in the day, 
and wages in the meantime went up from about $40 for two weeks' period 
to nearly $100, and it was a pride and a joy to see these men, the effect that 
it had on them. You would run across one of those furnace painters down 
town after work. They would get out of work before I would and I would 
often find them standing on the street down town dressed up like bankers. 
It made a big difference to them, all the difference in the world. They had 
clean clothes on, went home and had plenty of time to spend with their 
families and in recreation. I have had experience in athletics which brought 
out what Mr. Frey said tonight. One summer I took a long walk, I took 
this long Avalk under certain fixed conditions that we were to accomplish so 
much, try to make a record, in other words. We might have done two 
things : started out to see how far we could go the first day and break down 
in a short time ; we might have given up to our feelings and walked until we 
got tired and went back home. Some of the party did those things, but two 
or three of us would measure our pace and rest. Two or three of us stuck 
through to the end. My pal gained ten pounds in weight on the trip and I 
gained six, and we averaged thirty-seven miles a day. We were pretty 

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wabbly on the third day, but from that time we began to get stronger. We 
set our pace four miles an hour. We had a little thing on our hip by which 
we checked up on the time. Sometimes when we stopped to rest up we 
would take a jump into the Erie Canal, sit around, maybe had something to 
eat, maybe rest an hour or eight hours or a day, twelve hours some days, 
but eight hours at least, and we averaged four miles an hour, and I think if 
the manufacturer would analyze this question in this same manner, working 
it maybe six hours, eight hours or ten hours, bearing in mind, as Mr. Emer- 
son has pointed out, what is the human side, it would work out in the same 
manner. It pleased me very much when Mr. Henry Ford announced they 
were going to abandon the third shift, practically developing his plan so he 
could work on a two-shift basis instead of three. By checking up from the 
human side, it shows to the men what isn't good for them. Just one word 
in regard to autocracy and democracy. I feel rather keenly on that ques- 
tion, feel rather surprised and gratified to know that it bears out a certain 
theory I have that those who are most stirred up by the autocracy question 
that has brought about this great war are those who are the worst practicers 
of it in this case. 

We may question autocracy, but as to the rights between capital and 
labor I would consider no price too much ; let us not forget we have a lit- 
tle Germanv in our own country. (Applause.) 

MR. W. ADAMS: I would like to ask Mr. Frey a question: I would 
like to know if at any time capital and labor have ever gotten together and 
decided mutually what oart capital should get and what part labor should 
get. I don't know whether it is possible to decide that, but it seems to me 
until that is decided it will not be possible for labor and capital to come to 
an agreement. 

MR. FREY: I know instances where that was agreed on. 

MR. D. S. ULLRICK: Mr. Chairman: I was very much pleased to 
see that Mr. Frey put the emphasis on the human factor and that he attached 
what seems to me to be a fundamental fact, of human labor in dealing" with 
this problem. I am frank to sav that I have not before thought of arbitra- 
tion in the same ligdit in which Mr. Frev presented it. The recent develop- 
ments in industry have pointed us to this particular fact: that all industry 
is purchase and sale, a fact Mr. Frey brought out. The problem is the 
problem of bargaining - , but in salesmanship we have come to a new view- 
point. No longer are we expected, as a rule, to go to the trade and put 
over something on the other fellow. Salesmanship has come to be a pro- 
fession, because we have realized that the salesman performs professional 
service, carrying" a lareer knowledge of the particular thing he has to offer 
to the buver in the spirit of service and co-operation. Now, it seems to me. 
that exactly that thing is going to be the outcome of the viewpoint which 
Mr. Frev is presenting here tonight if we can carry the prooaganda of it to 
both sides. Examine the thing from the standpoint of the human side : 
we know that psychologically when you ©et one idea set un in the mind, if 
you undertake to argue, you must set up an oppositional idea, and then 
there is a fight on between the two ideas, and that is represented in all of 
us. We have all experienced what the determination to win on the side that 

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The Importance of the Human Factor in Industrial Preparedness 



we set up means. We have found, drawing again from the experience of 
.salesmanship, that it is the poorest kind of policy to get the customer into 
we set up means. We have found, drawing again from the experience of 
salesmanship, that it is the poorest kind of policy to get the customer into 
an argument. Now, the Board of Arbitration presents just that feeling. 
Here is one side and here is another and it seems to me that we are indeed 
fortunate tonight in having this presented in so clear a form and so con- 
cisely and so fully and I am glad to have this viewpoint and to go out with 
the viewpoint that the thing we need to do is to adopt the idea of compo- 
site bargaining. I really don't like that idea bargaining because that goes 
clear back to the time in the early history of merchandising when the seller 
would put his price high and the buyer would put his very low and then 
they would get together on the basis that suggested, but I think we are 
coming to a saner view of it now, undoubtedly that view of the case in 
which we will learn that autocracy on the part of the buyer or the seller 
will not be tolerated and we will find mutuality the key word of efficiency, 
efficient development of the human element in the future. People must 
remember that the human element is the element with which we are 
dealing in all these factors and not the thing which we looked upon for 
material production, machinery and all these things as the vital thing in 
industry. This subject and its treatment here tonight has put the emphasis 
exactly where it belongs on which you and I and the other fellow think and 
feel, and when we think right we will feel right and when think and feel 
right we will live together peacefully. . 

THE CHAIR: In addition to the speakers we have already heard we 
have with us tonight one man whose ideas on this subject will not only 
be interesting but also instructive. I speak of Mr. Barth. I am going 
to ask Mr. Barth if he will say a few words this evening. 

MR. CARL G. BARTH: Ladies and Gentlemen: I don't just feel 
as well as I should like to, sometimes I feel like talking and other times 
I don't. I don't feel particularly like talking tonight because I went down 
to Cincinnati the other day and I talked too much. They called me the 
human phonograph, never run down (laughter) and put my name along- 
side of it, but it's very hard for me to keep quiet. I have got a few things 
here of interest that I can bring up. I will ask Mr. Frey some questions. 
As regards the question of length of day of course its the same big ques- 
tion ; its the same story. We often find that people quarrel about things 
in a general way. There are a thousand different specific examples. A 
draftsman has his proper length of day, hours of work; a clerk has his 
specific length of day ; a laborer, and so on, and also finally coming down 
to what Mr. Emerson says that man is not always a beast of burden. How- 
ever, that may be I have never found that I am anything else (laughter) 
but I have had an awful lot of fun as a beast of burden (laughter). The 
other fellows don't have the fun I have, but it is with them like everyone else 
who is making too much money. There must be a certain number of hours 
in which any normal man will produce the most, because if he starts in in 
the morning to work like the devil he might be dead in half an hour and 
that isn't the way to get the most out of it. That's what we have the 

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black board for, I suppose, that we can make some figures on that, some- 
thing along the same line. The first question asked is just what pressure 
a man should work under. Experiments have been made along that line 
and it has been found out pretty well the proper length of hours ordinarily 
and what pressure appertaining to that will produce the most work inside 
of ten hours (drawing diagram on blackboard). That which is done by the 
human body is as that done by steam engine — that is, a certain maximum 
load, a certain length of day. So in any one kind of work we must have 
this condition and most any day can be reduced to mathematics. So here 
it is if we start out to work entirely too long hours we become inefficient, 
like a man worked too long hours and then falls asleep. They try to find 
the end of the day so they can have some fun, look at pictures, or make 
pictures if you have an inclination for that, but whether it should be 8 
hours or 6 hours or 7, I don't know, but if I am not wrong I am predicting 
that the time cannot be far of! before a man wrll be able to support himself 
and a family. Hours play an important part in the matter but it is also 
a matter of human desires. Just as soon as the neighbor gets a little better 
something than I have, "My God, I've got to have more money" (laughter). 
Then when I get a little more money I've got to have a $200 Victrola or a 
Player Piano, he's got to have that too, so if you have got to have the 
entire world you have to keep on working long hours. Now, I have got to 
that point myself. I have everything I want (laughter) and still, some- 
body insists upon giving me something for Christmas. Now, in regard to 
working long or short hours, a concern I worked for had figured this out 
so the draftsman worked ten hours a day in the shop, they had it reduced 
to 9 hours just before I started in there, so I started in at eight o'clock 
and quit at six, but there was one man there, a man very well known, an 
engineer in St. Louis, he tried to sell, he spoiled a good engineer and made 
a poor salesman. He was a rich man's son and he used to come in late. 
The Company in Philadelphia sent for him and they said, "Fred, I don't 
like this thing here, your. record for tardyness this year has been pretty 
bad." "Well," Fred said, "yes, I don't feel like going to work in the 
morning at 8 o'cock and quitting at 6. I feel that I can be doing more 
work for you by working when I feel like it than by coming in on time." 
They said, "Fred, do you really mean that?" He said, "Yes, I believe every- 
one could do more work for you." They said, "All right, we will try it," 
but before they gave it a trial Mr. Sellers sent for me and he said, "Barth, 
so and so said something, what do you think of it? I know pretty well 
you can't do as much work in 8 hours as 9." "Why?" I said. He said, 
"Because you work every single minute of the day." That was his per- 
sonal opinion of me and I will say I worked like the devil, because I was 
interested in everything I did. I said, "I would like to get off at 5 o'clock 
and go home, because I could get at my mathematical studies that much 
quicker. If I have that extra hour off I can accomplish just that much 
more in mathematics." So you see what I have accomplished in this line 
has been due to that hour off, it isn't much, but you all know I have done 
some work in the mathematical field, in fact it hardly paid for that hour. 
Then the hard times came along and some people didn't even get 8 hours a 

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The Importance of the Human Factor in Industrial Preparedness 

day, some only got 4 hours a week, then they picked up again and they got 
busy. Then in spite of that fact they had reduced the hours in the drafting 
room and they "had more work we turned out better work than ever before. 
But men that would like to work long hours weren't sent home and a great 
many women worked overtime and there was a sneaking idea the more a 
man worked the more he turned out. At one time I hoped to live to see 
the day at 6 hours myself, I really did, because I didn't think we were 
going to have all these victrolas and self playing pianos, but if they want 
them they better keep working. It is certainly true that the greatest bene- 
fiters to mankind did not work on a 6 hour day; they worked all the time, 
but they are exceptional men and able to stand up to it and they don't 
get indigestion (laughter). I want to ask Mr. Frey some more questions 
and maybe he will answer them. 

What do you want us to bargain, now, what is it you want us to 
bargain about? Just tell me one thing you want to bargain about really 
(laughter). Now, every man that comes to the shop seems to me bar- 
gains. He is told how many hours he works, how much pay he gets. He 
asks so much, we either turn him down or bargain with him and so you 
know, it is mere bargaining as it is. They want all kinds of up to date 
surroundings, toilet facilities, ask what toilet facilities you have, how many 
ights do you have, how is this, how is that (laughter). Now, all of these 
things I work for as hard as I can and endeavor to have them the best 
we can and the best we thing a man ought to have, but I can't do anything 
that produces more money for the company. What it is you want us to 
bargain? You know I am anxious to bargain. 

MR. FREY : Mr. Barth has opened up quite a field and Mr. Emer- 
son also. I was particularly careful in referring to fatigue as a result of long 
hours of labor. I refer to this one condition because the problem is being 
considered in this country as to increasing the hours of labor. In Great 
Britain it is being followed by reduced vitality, reduced efficiency, reduced 
production. I particularly used just that one subject, fearing the cry in 
this country will go up, let's have long hours of labor. Those who have 
studied the question have reached the conclusion that nobody can tell just 
what are the hours for anyone craft or industry. I don't profess to know 
it myself. I don't; nobody does. Those of you who are engineers, when 
you are calculating upon a structure built up on steel you have to start with 
the breaking point of that steel, about 65,000 pounds to the square inch, 
but that breaking point of steel isn't the important thing for you to con- 
sider, because when you have applied a testing load to that mcahine, 30,000, 
35,000 pounds to the square inch, you put a litte more test on that steel, 
yoyu have passed the elastic limit and the steel will never then return to 
its former shape, and then your engineer who is building gets the elasticity 
point in mind and never allows the load of more than that which reaches 
that point, upon the structure. Now, this is steel. As you go into the 
baser metals the elasticity limit is reached much sooner than the breaking 
point and we as human beings — our vitality is very much the same as the 
elastic limit and that breaking point. When the breaking point comes after 
the elastic limit has been passed, it generally comes forever. I may stand 

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much more of that strain than anybody else, but when it comes after hours 
of labor, the wear and tear of the physical being, you have much the same 
thing that the mechanical engineer has in the building. I am not trying 
to make an 8 day argument, I was merely calling attention to conditions in 
Great Britain where, by increasing the hours of labor they have conse- 
quently reduced the efficiency of the workers. 

Now, Mr. Barth wants to know what we want to bargain about. My 
only reply is this : We want to bargain upon every element, any relation- 
ship between employer and employe that effects us as employes, Is that 
conclusive enough ? 

MR. BARTH: Yes, that means absolutely nothing. 

MR. FREY: Yes, the hours of labor to be specific, the wages to be 
paid, the form in which those wages are to be paid, whether it shall be 
day work or piece work and all of the rules and regulations that effect us 
as employes, and that determine our relationship as employe or employer. 
In other words, to have the form of democracy applied in the same manner 
as nearly as possible, with the same intention that we apply democracy to 
our government. I know of no question affecting the relationship between 
employer and employe that would not be settled by agreement between 
the parties. I am strongly opposed ,to arbitration, autocracy on the part 
of the employer or employe. 

MR. BARTH : I am very pessimistic myself. I hope for everybody's 
good. 1 hope there wont be any difficulty but how are you going to bargain 
in a concern that employes 10,000 men. The ideal man is the one who 
does the best for the work no matter what he is being paid. I will say for 
myself I always tried to do that. I never in my life thought about the 
pay envelope when I did my work and the only time I thought about it 
was when I thought about all the things I had to buy with it when pay- 
day came around (laughter), so I don't see how we can bargain. I think 
I would eave it to the employers to do the right thing as best they saw it. 
I am as a little Rockefeller with my money. I hate money (laughter). 
Now, then, what are you going to do about it, Mr. Frey? (laughter). 

MR. FREY: Mly ideas are when the employes are in the wrong if 
they would sit down and talk things over the wrong would be corrected. 
My experience has been that the average man is very fair, regardless of 
the position he occupies. My friend Barth did something a while ago that 
I don't consider quite fair. He referred to the fact that I took a very active 
part in perfecting the system that has been installed in the Watertown and 
other arsenals. He would leave the opinion that it was the system itself. 
I wouldn't want to pass any opinion on the system, but in as much as the 
question has come up the reasons that I base my contentions on the con- 
ditions that existed there were because I found out that those in authority 
in the name of science committed blunders that were almost unbelievable 
and that never could exist in a plant where intelligent production can be 
carried on. I made an inspection with Mr.* Hoxie and Mr. Valentine and 
Ave discovered that a standard of 8 hours and a fraction had been set a 
job. whereas in reality it required over 40 hours to perform the job accu- 
rately. That was one little mistake, a difference of between less than 9 

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The Importance of the Human Factor in Industrial Prep^ 



^REDNESS 



hours and 40 hours. I found on another job where the amount of work 
had been practically doubled and the time reduced. I found many of those 
errors had been purely the result of miscalculation of the time and partly 
the result of mishandling- of information that had been gathered and placed 
on record in the routing department. On of the most interesting exhibits 
of incompetency in the name of science was that of the man in charge 
of the foundry, an officer of the foundry, who after I had called off some 
18 or 20 jobs that I had been told mistakes in the setting of time had been 
made in admitted that errors had occurred. To prove that he had not been 
doing so intentionally re requested us to eamine an exhibit that he brought 
out to show his heart was in the right place and he took up twice as many 
jobs which we had failed to get, on which he had set a longer time than 
necessary. It was because that incompetency existed in the United States 
arsenals that 'I was opposed to permitting that to exist. (Applause.) 

MR. BARTH : I worked for seven years for Uncle Sam and I worked 
for him for half money, half of what I could have got on the outside and 
all the time in the hope of being able to do some good, but finally I took 
up another line. These people that I have been with in 18 years have lost 
money. Now, that's too much, surely. The company is losing money 
every day and hasn't got a cent for a cold day when it comes around. Now, 
that's a question, how are you going to bargain about that? 

MR. FREY : I don't think we should bargain about that. I think when 
a manufacturer is so incompetent that he isn't able to pay what we usually 
call the market price of labor it would be much better for the community, 
for labor in general and for the man himself that that man should go out 
of business. (Applause.) 

Here is a manufacturer who is unsuccessful, he isn't declaring any 
dividends. Why not go to the material man and say this man should be 
able to secure his material at a less price than the successful man. You 
don't do that. Every manufacturer pays the market price for everything 
he buys except labor. (Applause.) 

I believe as a workman that it is a little more important that labor 
should get the market price than that anything else should be sold at the 
market price. 

MR. BARTH : They do take up the market price of supplies. They 
can't help it. 

MR. FREY : I think you will agree with me that you never raised the 
question yet of what should be bargained about when it comes to paying 
the market price of the raw material. You have got to pay the market 
price. 

MR. BARTH : I wouldn't say that because they did get it below the 
market price. 

MR. FREY: Well, the fellow that did that was pretty clever. 

MR. BARTH: I think we all want to do the right thing, only the 
question is how to get at it. Mr. Frey and I are absolutely working for 
the same thing, but it's only the question of how to get at it. 

MR. FREY: Our motives are the 'same but our methods are differ- 
ent. 

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MR. BARTH : You come along with me and you will agree with me 
from morning till night. (Applause.) 

THE CHAIR: I think as Mr. Barth said, one of the most hopeful 
signs of the times is the fact that this evening we have this element here, 
this discussion between Mr. Barth and Mr. Frey, both on this platform, 
they disagree and then decide again to agree. This discussion by the way, 
will be continued tomorrow morning in the round table conference in this 
room at 10 a. m. Mr. Frey has consented to attend. I asked Mr. Barth 
and he said he couldn't be, but I hope he will reconsider the matter and try 
to be here, because I think that the most permanent and tangible results 
from a conference such as this or discussion such as we have had and such 
as we may have tomorrow morning is if we do nothing else we bring out 
these differences and it is one of the most excellent things that can be 
done. It is getting light on all sides. But I wont consider our discus- 
sion closed until we have heard if not more than a few words from one of 
our members whom we respect and who has already given us a great deal 
of inspiration and has opened this conference, Mr. Knoeppel. 

MR. KNOEPPEL : I am going to make one statement and in making 
it I trust the statement will not be misconstrued, because in a way its a 
wrong statement to make, and that is what this trouble here that we are 
now in is a blessing in disguise to the. world, because we are going to get 
as a result of the war, rid of autocracy. Autocracy is going to be aban- 
doned, and* it will bring about a solution of the troubles between capital 
and labor and if we do nothing else beside that one thing I believe the war 
will have had its compensation. Five years ago I made an analysis of the 
work I was in. My partner and general manager, Mrs. Knoeppel, rather, 
decided that I should be living at home, and I desire to be at home, so I 
analyzed my situation to find out whether it was neccesary and why it was 
I was traveling -all over the country, never home, working long hours, 
taking losses, if I made them and the gains when they came, and I wanted 
to see if, after all, the thing was really worth while. It began to look at 
one period as if capital and labor could not get together, but I concluded 
as a result of my analysis to stay with the game and fight until I was 
finished with my work. So I am interested in the solution of this question 
of the relationship of capital and labor, and I think happily the war will 
bring it about ten or twenty-five years closer than otherwise. (Applause.) 

THE CHAIR: I know the hour is late, but I would like to hold the 
meeting open for a few minutes longer in order to hear from another 
one of our guests who spoke this afternoon and whom I know you will all 
be glad to hear from again. I will ask Mr. Grieves, Assistant Secretary 
of the Jeffrey Manufacturing Company to speak to us. 

MR. GRIEVES : Mr. Chairman, it seems to me it would be entirely 
out of place if I were to try to add to anything that has been said here 
tonight. I don't know when I have heard anything that is so gratifying 
to me as the address of Mr. Frey, also the remarks of Mr. Barth and these 
other gentlemen who spoke. It has been my privilege to be a labor union 
man ; it is also my privilege at this time to be an employer. I do say that 
these of you who heard me talk this afternoon may realize that I believe 

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The Importance of the Human Factor in Industrial P reparedness 

in both, the arguments of both Mr. Frey and Mr. Barth. Mr. Frey has 
said their motives are the same; their methods of obtaining- them are differ- 
ent. Now, that is the question we want solved. If we can get together 
we would have very little difficulty in solving our misunderstandings, but 
we know frequently labor representatives do not represent labor, on the 
other hand employers do not represent employers. So, it is a question, as 
I say, of the elimination of those who are doing # it for personal gain and 
the establishing firmly of those who are contending for what Mr. Frey 
and Mr. Barth are. (Applause.) 

THE CHAIR: The exhibit room will be open for a half an hour after 
this meeting. We will now adjourn to meet tomorrow at ten o'clock. 



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SIXTH SESSION 

FRIDAY MORNING, MAY 25, 1917. 



Round Table 
Francis A. Carlisle, Chairman. 

CHAIRMAN: The subject for consideration this morning is Labor's 
Viewpoint. After hearing the remarkable concise presentation last eve- 
ning by Mr. Frey of labor's viewpoint, I am sure that anything I might 
say would be of no particular benefit or interest to you. Therefore I will 
not inflict myself upon you but throw open the subject for general dis- 
cussion. 

MR. NORRIS : Mr. Chairman, just to get the opinion of some of the 
gentlemen here who have had experience in obtaining the co-operation and 
democracy that Mr. Frey talked to us about last night for labor, I wonder 
if any of the manufacturers here have tried a committee of laborers to treat 
with their fellow laborers and the management of problems affecting both. 
I know in the few factories that I have been in, the laborers otfen-time take 
advantage of the management when the management is lenient, they come 
in late in the morning, they don't start working on time; they quit early at 
noon, and they waste time running back and forth. Is it possible to elect a 
committee in the factory, representative possibly of the laborers from each 
department, to act as the self-disciplined committee to see that the laborers 
get a fair deal and to treat with the management in seeing that the man- 
agement gets a fair deal. Has anyone had any experience along that 
line? 

MR. FITZGERALD: I would say for our factory that we have a 
factory board composed of the treasurer of our company, the assistant sup- 
erintendent, one foreman and three factory men ; one man from the 
machine shop, a man from another department, and a man from the 
shipping department. These men meet once every week and talk over con- 
ditions. We find in that way we have kept our men more satisfied. If 
they have a disagreement it is taken up with this board and they thrash it 
out. Of course, in my position with the company, I am between the labor- 
ing men and the management. About a year ago, I got a little idea and 
put it up to the management of our company. They told me that it would 
cost too much, that they could not afford to spend the money. "Well," I 
said, "you loan me $1,000 and allow me to put a commissary in our lunch 
rooms" — we had a lunch room at the time for the foremen and another 
lunch room in the factory for the men — and, "I will repay you the $1,000 
and in the meantime do some real welfare work." They said, "All right, 

144 



The Importance of the Human Factor in Industrial Preparedness 

go ahead." We had a nurse who had charge of our first aid department 
who was very competent, and got good pay. I took her and told her that 
I wanted her to visit the homes of men who worked for us whom I knew 
had sickness of some kind or another, and I took another young girl from 
a factory and broke her in to the first aid department. I then established 
this little commissary and sold coffee and milk and so forth at the cost 
price to our men. The first month I started this our little commissary 
cleaned up $110.00. The second month somthing like $240.00 and now we 
are averaging $550.00 a month. These men are paying their money in and 
getting something in return in real welfare work. This nurse goes out and 
does a whole lot more than I could do in the families of our men. Our 
men would resent my going in and prying into their private affairs but she 
can go in and find out a whole lot, and I can afterwards take care of it. 
That is the way we treat our men. I can say that while we haven't reached 
the millennium or anything like that, we are in very good condition. I 
think if more companies would work along that line, the welfare line, they 
would get better results. 

MR. GEO. MACKAY: Mr. Chairman, I don't wish to appear in the 
situation of injecting a discordant note into thees sessions, which are so 
splendid and so helpful, but I can't help feeling that there lurks in the back 
of my mind a feeling that pervading all these sessions there is a lack of 
comprehension. To my mind they have been too technical, too isolated. It 
appears to me that we look upon efficiency as a method. Now, efficiency 
is not a method, it is an ideal. Ideals depend on moral forces, resolving 
the movement of history back into its constituent elements. The one thing 
that the human race has ever attempted to hold to the forefront is the ele- 
ment of courage. Now, we are in the midst of a great world movement. 
Into what, in terms of form, in terms of constitution an organization it 
will eventuate itself it is beyond the mind of man to tell, but of one thing 
we may be reasonably certain, we are on the highway to democracy. That 
has been recognized by Roscoe Pound, dean of the Harvard Law School, 
when he says that one of the outstanding facts of the present day is the 
transfer of the center of gravity of legislative action from property to social 
rights. Where are we going to end? Now, anyone with a spark of imagi- 
nation can see mighty clearly that the impetus given to group action and 
to morale that is going to result from this war is going to create a new 
world; and one of the great tasks of America, as James J. Hill has pointed 
out, is not to create for a nation a place for itself under the sun but to so 
organize itself that its daily overhead expense account can be so systemati- 
cally and so scientifically arranged as will measure to the largest extent of 
human happiness and prosperity. Now, it comes right back to the question, 
as I look at it, of wages and housing conditions. I wish in no wise to 
detract or divert the attention of this meeting, but when you go all over 
this country and you think of the housing conditions of the great majority 
of the people for one thing and the wages on the other hand, we are a 
mighty long way from democracy and human happiness. 

Now, all our wealth goes back to force, the land force, the seas and the 
mines. All our happiness and all our prosperity depends upon the work of 

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Western Efficiency Society Conference 



the common laborer. We have done absolutely nothing to stabilize the work 
of the common laborer. The only outstanding instance that I know of, 
an attempt made to stabilize the lower strata of our industry, of our indus- 
trial order, has been done by the Ford Motor Company, and anyone who is 
familiar with, their work knows how wonderfully that lower strata has 
responded to that plan and how they have developed under the stimulus of 
a living wage. 

It seems to me really a point of view that is more comprehensive than 
mere method ; you have got to reach back to humanity. Our civilization in 
this country, from the time of the Civil War at least, to the present, has 
been dominated by mechanics. That must, from now on, give way to the 
wider comprehension of humanity. It doesn't interest me particularly the 
direction or the particular form of organization in which this spirit of 
humanity is going to eventuate itself. The thing of which we stand in 
need is to grasp the fact that there is this movement for humanity, and if 
I ventured to express a criticism, I would say that is the outstanding thing 
of which a large' group of which our industrial leaders are deficient, a lack 
of comprehension and a lack of sympathy or appreciation of the trend of 
the times. 

Gentlemen, we cannot ignore the trend of the times. We are making 
history mighty rapidly and within a quarter of a century we are going 
to live in an entirely different world, dominated by different moral forces, 
dominated by a different system of economics than, I believe, has obtained 
in the past, and that is the way I look upon the situation. In view of that, 
there has arisen in my mind the feeling that from these meetings something 
more could be decided. (Applause.) 

MR. J. P. FREY : I took up a great deal of time last night and I came 
this morning to listen, with no intention of sayjing anything unless I 
endeavored to answer questions. The last speaker has stirred up a good 
many thoughts in my mind because he has hit the nail on the head, I think. 
My own experience is a peculiar one. I was a workman. For the past 
two or three years I have been very active. I have had the good fortune 
to associate with engineers and I have a large number of associates among 
employers. I have handled a good many strikes, carried on negotiations 
with employers. I have been in the game from the top to the bottom, which 
means I have had experience. I have made some study of this scientific 
management, so-called, and I have the greatest of admiration for much of 
it. I think that the efficiency expert who is able to eliminate any unneces- 
sary labor or introduce a new process is as great, if not a better benefactor, 
than the man who made two blades of grass grow where one grew before, 
but in coming into contact with those outside of my own group, the edu- 
cators and the efficiency engineers and some of these men who never have 
had any practical experience, but with a love for their fellow human beings, 
endeavoring to work out some scheme for improvement, I have noticed this : 
It has always seemed to me to be a most treendous handicap that their 
minds, the trained man's mind, the efficiency engineer, the mechanical engin- 
eer, the professional philanthropist, looking for some system that is going 
to bring justice ; placing their faith in some scientifically prepared formula 

146 



The Importance of the Human Factor in Industrial Preparedness 



which if applied is going to do away with all these unjust, unnecessary 
conditions that make so much trouble between men — the longer I live the 
less faith I have in formulas for accomplishing results where they are 
applied to human beings. It is an entirely different situation when you are 
applying a formula to chemicals or to machinery. When you try to apply 
these formulas that you work out to human beings, I think invariably you 
wil find some factor that has been overlooked that completely wrecks the 
results. There are a group of students, economists, who have spent a large 
number of years in studying trade agreements. They seemingly had faith in 
some form of agreement the provisions of which and the language of which 
would establish justice if they were only applied. I negotiated many agree- 
ments with employers, sometimes with individual plants, sometimes with 
employers, covering a large territory, and I have found that the language 
of the agreements, the provisions provided, contained in the agreement 
have very little to do with the successful working of those who were covered 
by the agreement; the important thing not being the language or the terms 
of the agreement so much as the spirit, which actuated, which is controlled 
by the agreement. Now, if I have any criticism to make of scientific man- 
agement it is only in that part of the systems which you have worked out 
which applied to labor, and I say the failure has been to bring about a 
willingness to co-operate, a failure to recognize that like creates like. There 
are men holding official positions in the trade union movement who are 
grafters and who should be in the penitentiary because of that fact, but 
they never could have existed had there not been first an employer who 
was willing to be a bribe giver, so that punishing the grafter is not getting 
at the core of the matter, or enacting laws against bribe giving is not going 
to cure the thin. It can only be cured by establishing the proper attitude 
on the part of everybody concerned in the industry. 

There is a revolution going on, just as Mr. Mackay has said. We do 
not recognize it in this trade union movement that I am in. We are the 
revolutionists. We are more revolutionary than any other movement among 
men that I know of, with, perhaps, the exception of those who believe in 
turning over all of the means of production and distribution to the people 
themselves. We do not feel that we are revolutionists. I have no feeling 
of a revolutionist. I feel that the work I am doing is constructive, but I 
have begun to recognize the fact that the great revolution that is taking 
place is the final one in civilization. If you will bear with me for a moment 
so I may make it clear, it was not many centuries ago that no man wor- 
shipped the Almighty according to the dictates of his conscience, he wor- 
shipped the Almighty according to the formula which the wise men and 
which the best men had drawn up and which they thought, if not scientifi- 
cally sound, was theologically sound. It was found it would not work and 
a good, many men lost their lives before demorcacy in religion could be 
established. 

Now, in this country today no one questions the right of any indi- 
vidual to worship in any church in the community. There is no question 
about it, about every man's right to worship as they please. In fact, we 
would resent any attempt to force religion upon anyone else, because we 

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Western Efficiency Society Conference 



would realize that if it succeeded the next day it might come to us. That 
is true of us. The original idea, I presume, in the minds of the theological 
teachers and the church men in the church was that the average man does 
not know enough about these questions and it was unsafe to allow them 
to begin to think for themselves and co-operate among themselves on the 
question of religion. The same was true in political governmnet. There 
was a time when the few thought they had a God-given right to govern 
others, or, as old Rumbolt said, ''Some men were born in this world with 
saddles on their backs and other man booted and spurred to ride upon them." 
Now, thrones have been overturned, dynasties have gone out of exist- 
ence, so that the principle of a man's right in determining the laws under 
which he was living should be recognized. In this country we have given 
a practical application to the idea. Other countries are doing the same. We 
have won democracy in religion and we have won democracy in govern- 
ment, but there still remains a tremendous factor in our lives, that is, in the 
lives of the great masses of the people, and that is the one I referred to last 
night : In industry there isn't democracy. Little gleamings of it are found 
here and there, but the management is convinced that it cannot allow the 
workers to participate in determining rules and regulations inside of the 
plant. I have had practical experience. I am not discussing this thing theo- 
retically. y Now, I know in more than one instance where if the workers 
over night had been given the power to determine rules and regulations the 
sheriff within a very short time would have hung the red flag over the door, 
but I also know of employers having everything their own way, and you 
gentlemen from your own experience have found how inefficient and incom- 
petent a very large number of employers are to manage their own business. 
All they have done is mismanagement and they have all had that theory, 
"I must have the right here." They still have that same element which is 
operating in their minds, that there must be autocracy. My conviction 
is that it is not formulas which you can work out ; it is not the careful efforts 
which you may develop so that your time studies may be as accurate as 
possible ; it is not your being able to determine through the methods you 
apply whether a thirty-three and a third per cent bonus or a twenty per cent 
bonus or a twelve per cent bonus is the one best calculated to bring the 
most satisfactory results so far as production is concerned. These may be 
important questions, but to my mind far more important than that is intro- 
ducing the spirit of democracy into industry, recognizing the fact that where 
you set down hard and arbitrary rules for other men to follow, unless they 
are given a voice, unles they take part in agreeing that these rules are wise 
and just and acceptable to them, you are going to foster the very same 
spirit that led to the reformation in Germany and that led to the revolution 
of the American colonies. 

Now, I am an American. I do not mean I was born in this country. I 
say I worship the institutions of my country. I think they are the finest 
of any country in the world, but they must be carried all the way through 
in all of our relationships, whether it is that of citizens to each other or as 
employer to employe, if we are p-oing to be successful in the long run, if we 
are going to prevent revolution in this country at some time or other. We 

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The Importance of the Human Factor in Industrial P reparedness 

have had civil wars in this country within the last few years.' We have seen 
th conflict between capital and labor or the employer and the employe reach 
that stage where the state courts, apparently, were no longer effective, where 
the state militia was ordered out and they created a condition that seemed 
to be still worse and it became necessary for the Federal Government to 
send Federal troops into a portion of the state so that the anarchy created 
by the state courts and the state militia could be suppressed until common 
sense and a desire to bring about justice had begun to operate. Now, that 
is a civil war, gentlemen. That is civil war on a small scale. Civil war in 
the state of Colorado, for illustration. Now, you can't cure these things 
through formulas that you may work out, no matter how good your inten- 
tions are, no matter how you may study and analyze. You are never going 
to cure these problems through formulas. You are going to cure them 
rather by conceptions which will enter into men's minds. I said that like 
makes like. My own experience, and I am just an average human being, 
is that if a man will sit down and give me half a show, I feel I have got 
an opportunity of making a little progress towards the settlement of some 
question that has been referred to me.. When an employer meets me with 
a closed and an armed first he arouses exactly the same feeling in me, and 
then instead of desiring to settle the question absolutely on its merits I 
want to fight. Now, in our trade union movement we have a lot of men who 
are scrappily inclined. Mr. Chairman, perhaps I am taking up too much 
time? 

THE CHAIRMAN : A few minutes more. 

MR. FREY : I am a man that when I have entered into an employer's 
office and the employer would say something which I resent myself, I try 
to be reasonable about the matter. One employer said to me not long ago, 
"If all of the men were as reasonabe as you are, Frey, we would get along 
all right, but I have got a Shop Committee here and I can't do anything at all 
with them. Half of them are no good. They are not my own men. They 
come into my office and I might as well try and do business with the old Nick 
himself as with them. If you will get a decent Shop Committee, perhaps I 
can do something." I told the gentleman that the union did not select that 
Shop Committee, that he had selected that Shop Committee himself, that 
he had picked out the most stubborn and the most illogical and unreason- 
able men in his plant. Of course, he would tell me right away that I didn't 
know what I was talking about, but I would explain it to him. I would 
say this, "You have among the men in your plant some whom we will call 
home guards. Perhaps their parents were born here and they own a little 
home here and they don't want trouble. The average man doesn't want 
trouble any more than the unions want trouble, he is afraid of it, he don't 
want the expense and he don't want the risk that is involved in a severance 
of relations between the office and shop. Now, for some reason or other 
you have not cared to deal with the Shop Committee, you have not looked 
upon these men with particular favor, and through the one thousand and 
one means that you, your general manager, your superintendents and fore- 
men have, you have punished the good men Avhose interests lay in being 
the Shop Committee men until the men you want, the good men, your local 

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Western Efficiency Society Conference 



men are unwilling- to serve on the Shop Committee, they feel they are run- 
ning- the risk of your disapproval to such an extent that your disapproval 
will reach them, and the time has been reached when none of the type of 
men that you want are willing to serve on the committee. And, finally, there 
is a union meeting and the chairman of the meeting would say, "Down in 
Brown's shop there is no Shop Committee. Who will volunteer to act as 
Shop Committee." And finally some fellow who has got nothing- at stake 
will get up and say, "Well, Mr. Chairman, I am not afraid of the boss, I 
will volunteer to act as a Shop Committeeman. I will show that boss I 
ain't a-scared of him." And so the employer selects the type of man who 
is going to be on the Shop Committee. 

Now, it is the attitude that is the trouble, the attitude of the men in 
the office reflecting itself in the attitude of the men. It is the attitude in 
the office, and I say this from my personal experience, it is the attitude of 
the office more than anything else that determines the attitude of the men. 
Now, you have got to know something about the time required to do the 
job. You must know something about costs. And if you hope to solve 
this problem by merely working out formulas, my opinion, gentlemen, is 
that you will be no more successful than the theologians were in working 
out their creeds, some of which we scarcely know the name of today. 

MR. WALLACE: Mr. Chairman, if I may, I wish to say in the course 
of my experience in the past twenty years I was working down at Chicago 
Heights and working for a concern there, getting what I considered a fair 
wage. I learned of an opportunity to change my position and work for 
another institution in that town and immediately made application for the 
position and was accepted by the superintendent. I went into that plant 
as a tool-maker. I hadn't worked there three hours before I was visited 
by the Union Shop Committee and asked to show my card. I told them 
I did not carry a card. I would have to do so if I wanted to work there. 
I told them that was a matter they would have to discuss with the manage- 
ment and not me, the management had seen fit to employ me and I intended 
to remain. Now, then, all the arbitrary methods do not come from the man- 
agement. These men were local representatives of the Union and it was an 
open shop, but they tried to enforce me and intimidate me for weeks to join 
their Union. I didn't feel it necessary so to do. I was of that frame of 
mind, just as Mr. Frey says, I was one of that kind that wanted to fight and 
I was expecting it, but it just so happened that the .particular delegate to 
that Union, the Chicago representative here, was an old personal friend of 
mine. We had been fellow athletes together and walkers and runners. ^ He 
went down and he told the Shop Committee, "Lay off that fellow, he is all 
right." I stayed there for months and I was a good fellow, but the spirit 
of the thing, the intimidation of coming in there and telling you that you 
must do so and so is entirely wrong. 

MR. MACKAY: In the issue under date of March, 1916, of the bulle- 
tin published by the Colorado Fuel and Iron Company, there appears a state- 
ment substantially like this: "In the balance sheet of any organization, in 
the assets, rather, of any organization there are items which do not appear 
on the balance sheet," or something of that sort, "of which the most con- 

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The Import ance of the Human Factor in Industrial Preparedness 

spicuous is the loyalty of any group of employes and of which we are proud 
to say that we stand preeminent." 

Now, speaking of comprehension, I am going to repeat something that 
I said here. I ventured to suggest yesterday morning, I don't think that any 
group of men, efficiency experts or employers, could employ their time or 
invest their time to greater profit than to read the first volume of. Buckle's 
History of the Civilization in England. I have read most of the efficiency 
literature that has been produced, but I want to say that I lay Buckle's 
History of the Civilization in England under greater contribution than all 
the efficiency literature I have read. This appears in four volumes and may 
be secured at one dollar for the four volumes from the National Library, 114 
West 14th Street, New York City. Speaking of motives, no man has studied 
the motives in terms of loyalty like Royce has. It goes to the very root. 
But it is as old as the hills. The same idea was supported by Ruskin in his 
essay "Roots of Honor," when he said that the great problem in regard to 
the human machine is to find out the motive by which it operates. (Ap- 
plause.) 

THE CHAIRMAN : The time has now come for closing. I trust that 
the things that have been said here will be instructive and we will be able 
to go to our various places and apply these things. I know that I have 
profited. 



151 



SEVENTH SESSION 

FRIDAY AFTERNOON, MAY 25, 1917 
A. B. Segur, Chairman 

THE CHAIRMAN: The first speaker will be Mr. Harry Franklin 
Porter of the Executives' Club, Detroit, who is also an old member of the 
Western Efficiency Society and before leaving Chicago for Detroit one of 
our most active workers. Mr. Porter will talk on "Safety First." 

MR. PORTER: Mr. Chairman, men and women of the conference: 
^ou notice that I am using the modern term, disregarding ladies and gen- 
tlemen. (Laughter.) 

I think this program was not arranged very well at the start, but I think 
it has been re-arranged very scientifically. It has always been my opinion 
that they should have the best for the last. Therefore, I am not going to 
prevail upon your time at great length.. I am going to get myself out of 
the way as speedily as possible, as befits an opener, to prepare the way for 
the good things that are coming* along in an ascending scale later in the 
program and culminating with our good friend from Providence, Frank 
Gilbreth. 

I do not know as I can add anything especially new on the subject of 
Safety First. It is a subject that has been pretty thoroughly covered, anal- 
ized and propagated throughout the country in the last few years. It has 
been one of the most amazing movements of modern times. 

However, there are a few thoughts that I would like to present for your 
consideration in connection with the movement. I never have been a 
safety first man primarily. In fact, at a safety first meeting" recently, where 
I was a speaker, I was accused by one of the men, after I had delivered my 
talk, of never being a safety first man, that I never played safe. Well, that 
depends upon your definition of safety first. 

We can conceive of such a hopeless condition down there at the corner 
of Madison and State, for instance, with no traffic regulations or anything; 
people and teams and automobiles and everything else all madly trying to 
scramble through at the same time, and some conservative man or woman 
standing aghast at the possibility of getting across, and saying, "Well, I am 
goinp- to play safe. I am not going to cross." 

That is not, of course, my conception of safety first. The pacifist i^ 
one example of the safety first man. But that is not the roncention of 
safety first that I have. Mv conception of safety first is — well, I misfht word 
it another way. I believe if vou pay proper attention to efficiency that safety 
will 11 suallv take care of itself. 

Take the little example in traffic congestion. If we look at the problem 

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Western Efficiency Society Conference 



as an efficiency problem, analyze it and arrange things in order and provide 
the proper regulation, it then becomes safe, and you will find if you analyze 
the causes of industrial casualties or accidents that you will uncover one 
after another sources of inefficiency. That is one of the corollaries, the by- 
products of the safety movement, — increased efficiency. 

On the contrary, you take establishments where efficiency has been first, 
where the safety movement has not been recognized as such until quite 
a long while after efficiency has been well recognized, there the safety prob- 
lem has never been of very great moment. 

I have in mind particularly the plant of Joseph T. Ryerson & Son, of 
which Mr. Berndt is the manager of the betterment department, and under 
him comes safety. In confirming or in verifying that impression in going 
about visiting different plants, I almost invariably found that in the efficiently 
managed plants the accident question never has been of real serious moment. 
It is taken care of instantly. I do not know of an engineer who does his 
work properly who does not consider that. He is dealing with safety factors 
all the time. He considers that when he selects his unit stresses and works 
out his designs. I do not know of a construction engineer on the job, who 
in doing his work does not do it economically, quickly and safely and with- 
out the sacrifice of human life. 

However, with the speedy evolution of the marvelous growth of Amer- 
ican industry and the quick passing away from the stage where the owner 
of the concern was in intimate personal touch with his employes, where 
he could watch everybody, to the sudden expansion on a large scale of 
operation where the supervision and management was so far removed from 
the men that a great deal of carelessness got into the supervision down along 
the line in minor positions, the result was a harvest of accidents. That was 
also partly due to the fact that there prevailed throughout the industries 
the belief that that was the workman's own risk, the same kind of policy 
in "let the buyer beware," that used to prevail in buying. 

Through the humanitarians, business leaders, and others we have now 
gotten levers working by which we have gotten the manufacturers convinced 
of the fact that accidents are a legitimate expense of burden or tax on the 
industry. 

Now, that puts a different phase upon the situation at once. It makes it 
possible by proper cost accounting methods to absolutely justify every reas- 
onable or sane measure of accident prevention. I venture to say that if 
the cost movement had become sufficiently developed ten, fifteen or twenty- 
five years ago, so that we had department costs, the costs of accidents, of 
turn-over and the cost of broken time due to accidents or sickness growing 
out of that condition, — if that could have been shown up as an element of 
department expense, the eyes of the managements all over the country would 
have been awakened to the importance of this great element much sooner 
than it has been. 

I was here in Chicago at the time the National Safety Council was 
organized and was much interested in the movement and participated for 
a while in the organization work of this council as an editor and one familiar 
with the influences reaching managements as to the best methods of pro- 

154 



The Importance of the Human Factor in Industrial Preparedness 

pagating the safety first movement. Those who were the main principals 
in the organization were filled full of the humanitarian aspects of the ques- 
tion. That is very fine. It was the fact they were engaged in the great 
business of conserving or saving human life that appealed to them, and 
that is what they wanted to do. They wanted to go all over this country 
like Billy Sundays, talking to manufacturers on that side. 

I told them that I was just as great an apostle of human rights and a 
lover of human beings, as anybody; nevertheless I thought they would get 
much better results if they would approach it from a more practical stand- 
point. A cold blooded standpoint, if you please, an economic standpoint. 
And I helped them get up some letters that advocated accident pre- 
vention and organized safety work in plants, purely on an economical 
basis of dollars and cents, that it would absolutely pay. 

Well, they did not like it. It was too cold blooded. However, they 
found it necessary before they got very far along in the work to come to 
that basis of approach. 

Mr. Knoeppel in his opening speech the other day pointed out the fact 
that thirty-five thousand lives are lost in industries every year and some- 
thing like 700,000 lives are jeopardized by accident. 

Now, that is a tremendous toll. It has been cut down tremendously 
through the work of the safety engineers and the organized safety propa- 
ganda, that is true. For instance, the United States Steel Corporation forty- 
six per cent since 1906 is the record. They have cut their accidents forty- 
six per cent. Each year twenty-three hundred of the men employed by 
the corporation are saved who would have been injured under previous 
conditions. 

The Eastman Kodak Company in the last five years have reduced acci- 
dents in their plants over seventy-five per cent per annum. 

Just consider this question in connection with our present war situa- 
tion. Never in the history of the world has the human individual unit 
been of greater importance than just now. An increasing price is being 
placed upon the human individual. A great many people years ago thought 
that as civilization grew and the population increased that individuals would 
become of less and less importance, and I am afraid many of us have become 
soured on life and given up the struggle, because we have felt we were so 
insignificant as compared with the great mass that it did not pay to keep 
up the struggle. Now, one of the by-products of the war is accelerating 
that viewpoint which is placing a greater value upon the human individual 
as never before in the history of the world. Never before has life been so 
dear and so sweet as now. You can see what it means — thirty-five thousand. 
I venture to say we will be in this war a great many months, maybe a year, 
before we have thirty-five thousand men killed on the firing line, and maybe 
we will not have as many as that and as many injured as 700,000 during the 
whole period of the war. 

But because these accidents do not receive notoriety in the press and 
are scattered all over the great expanse, of this country, they do not im- 
press us. For every one of those men who is killed we have got to rob 
the army of one who would go. Place it on that basis. So it becomes more 

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Western Efficiency Society Conferen ce 

important now than ever before that safety work be recognized. If we 
can cut that down twenty-five thousand men this year, we will have twenty- 
five thousand more available for the war front. 

I was talking to a man in Detroit the other day, where they have gone 
a long ways in safety work, where their machines are safe-guarded as per- 
fectly as perhaps possible. They have lately been substituting men with 
women. In one particular case the punch press; they had it safeguarded 
so that ninety-nine out of a hundred men, or perhaps everybody questioned 
on the subject would have said that machine is absolutely fool-proof. There 
was a little bit of a hole, hardly bigger than your finger, that was the only 
place where a person could be hurt. Yet one of the girl operators, who was 
thoroughly taught about the scheme and thought thoroughly competent to 
handle the machine, got her finger in there one day and lost it. 

We are facing the situation, perhaps, of employing in industries thous- 
ands and thousands of women, who have never been before in industry, 
who are unfamiliar with the conditions there, and it becomes increasingly 
important that we provide as a part of our training preliminary training 
for these women, like accident prevention and safety work, and in this con- 
nection we might very well plan to make use to the fullest extent of the 
very excellent device that Mr. Gilbreth has developed, the motion pictures. 
I know of no better way in which women who want to go into industry, 
who register for the service, can be given so much training in the proper 
kind of accident prevention work, as by means of the motion picture. 

So much for that. I said a little earlier in my remarks that if you 
analyze the cause of accidents you uncover one after another sources of 
inefficiency. You will find, for instance, one of the causes of accidents is 
poor lighting. We also know that poor lighting is a big cause of spoiled 
work and of lessened production. 

We have experimented in my own plant with that. In installing new 
lighting in a new plant I arranged also for the same system of lighting as 
before. Within a few weeks after the new lighting was installed the 
efficiency was increased ten per cent. Then the old conditions were restored 
and very promptly it sank to its former level. Then we restored the new 
conditions again and in a very short time it recovered that ten per cent 
loss ; proving, I think, unmistakably that lighting has a very important part 
to play in production. 

Over twenty-five per cent of the accidents are credited to poor lighting. 
About twenty-five per cent of spoiled work, of which the grand total is 
something over a hundred million dollars a year — I am not quite sure of 
my figures, but it is an enormous amount of money that could be saved 
there, so by correcting a condition which is prolific of accidents we also 
gain heavily on the other side. 

Take the question of hours which was discussed so ably last nisrht. 
Long hours have proved to be a prolific source of industrial accidents. Men 
become very tired and they do not sleep enough to be fresh the next day ; 
iust drag through, and to men in that condition, there is always something 
likely to happen. There ought to be a time of rest. Accident statistics show 
that it runs higher during the morninsr hours until the noon, and then after 

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The Importance of the Human Factor in Industrial Preparedness 



that it goes down. Undoubtedly there ought to be a respite during the 
forenoon. 

Then there is the question of interest in the work. Minor men furnish 
a large part of the accidents, men who are not interested in their work, 
thinking of the good time they had last night, or a quarrel with the wife, 
or they have a grievance, their minds on everything except on the work, — 
they are the men who are getting hurt. That goes right back to the question 
of efficient management. If we can solve the problem so as to get the men 
interested in their jobs, such as Mr. Frey described last night, we will have 
gone a long ways towards solving the accident problem. 

Under-nourishment and outside conditions, environment, all enter into 
the problem and can only be solved by a kind of follow-up work that is done 
particularly in the plant of The Joseph-Feiss Company, Cleveland. 

You have got to hunt down this trail of inefficiency, wherever it may 
lead, inside or outside of the factory, and all over, covering the home-life of 
the man, his recreations and everything. 

Then there is the attitude of the foreman. Men are of different tem- 
peraments. Some men, no matter how autocratic, despotic and inhuman and 
brutalizing and bull-dozing the foreman may be, are not affected by it. But 
the great majority of us like to work for men and work best for men who 
win our sympathy by kindness and consideration. I am satisfied myself, 
although it is hard to prove consistently, that bull-dozing bosses are re- 
sponsible for a great many accidents. They scare the men, and they draw 
into themselves, and get nervous. Speaking personally, I know when I get 
into that condition myself, then is when things go wrong, accidents happen. 

Green men, untrained men, are one of the great sources of accidents. 
About the first week I had my automobile and was very green in driving 
it, I had several accidents, one of them cost me twenty-six dollars. It was 
quite a caution to be very careful. But now I can drive even in Detroit, 
where they have streets criss-crossing in every direction and where a man 
who never ran an automobile perhaps would not venture. I run it under all 
sorts of conditions any time of day or night, at the worst corners, without 
any thought of danger. That is because I have become skilled in running 
it. You cannot expect green men and women who have only a superficial 
knowledge of machines and are expected to operate them to run these ma- 
chines without getting hurt. 

That brings up the question of training schools. Why should not every 
factory have a training school, where all new hands might receive a thorough 
training before they are put out in the mad rush of production, where excite- 
ment prevails and the main thought is to get out production? 

Over in the Ford Motor Company they found one of the greatest diffi- 
culties was a mad desire to get out production. The foremen were not 
interested in safety. A machine might not be safe and they were not inter- 
ested. They wanted to get out production. So it was necessary to give 
authority to the safety engineer to stop any machine that he thought not 
safe. 

I venture to say, getting back to the cost side of it again, if the cost 
of accidents were shown up properly as a departmental expense, that the 

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W. R. DE FIELD 



The Importance of the Human Factor in Industrial Preparedness 



foremen would be just as much interested in having a safe department as 
a department known for holding up its own in a production way. 

Absence of good traffic regulation is a big cause. You find in many 
factories work piled up criss-cross, no style; trucks cannot get by; tur- 
moil. You must expect a harvest of accidents under those conditions. You 
have got to have everything in order. And back of that is decent orderly 
thinking, thinking right. That goes back to the management. If tlie man- 
agement does not think right it necessarily follows that the factory will re- 
produce the mental attitude of the management. And the same way if the 
workmen are careless with one another, and if the foremen are careless with 
one another, it probably means, that the man who is the dominant mind of 
the establishment is indifferent to human losses. He does not care whether 
men get hurt or not. The management has got to be considerate of the 
human side of it. If they are considerate of the human side of it the foremen 
and all the other men down the line will reflect the same attitude to one 
another. 

You will notice I am coming now to safeguards. In the early part of the 
safety movement that was one of the big things. Safeguards were very 
important. Yet in my opinion they are of the least importance. You need 
them, but they won't of themselves prevent accidents. After all, it comes 
down to the individual, the efficiency of the individual ; and even the most 
efficient of us are sometimes careless. We get absent-minded, like Mr. 
Knoeppel did last night when he dropped his glasses and broke them, like 
Mr. Emerson did down in Washington when he tried to get on a street 
car under conditions where he should not have attempted it. 

But nevertheless, that is after all the real notch of the problem, to reach 
the individual, to have him think decently and to be thinking of the other 
fellow and to be thinking of safety and efficiency himself. That is a matter 
largely of organized instruction. The whole shop has got to be included. 

THE CHAIRMAN: The next speaker is Mr. W. R. DeField, super- 
intendent of systems, Montgomery Ward & Company, who will speak of 
the Corporation School Movement, a work which he has been closely identi- 
fied with for several years. 

MR. DEFIELD : Mr. Chairman, ladies and gentlemen : I will try 
to stay close to the subject of the corporation school movement and endeavor 
to stay within my time. 

CORPORATION SCHOOL MOVEMENT 
By W. R. DeField 

The Corporation Schools of today are so numerous that probably all 
of you are quite familiar with the plan of operating of at least one, and 
probably more than one, such school. It has often been said that the Cor- 
poration School was made necessary because of the failure of the Public 
School System to properly train our young men and young women to read, 
write and spell. This charge has been made openly by many, but I believe 
the charge is without foundation. Of course, occasionally, there is a school 

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Western Efficiency Society Conference 



which is not up to standard just as there are many business houses which 
do not measure up to the standard. 

The Corporation School has come into existence because of the neces- 
sity for training young men and young women to know the details of how 
to perform the tasks peculiar to a particular business. The apprentice sys- 
tem has been in vogue for a great many years, and now becomes a part of 
the Corporation School because it is realized that instruction given by in- 
structors is much more beneficial to the apprentice than the. knowledge he 
may acquire by knocking about the shop for several years. 

The loss in training new employes to the semi-skilled positions in the 
past was not even considered, as it was thought the correct thing to hire 
Peter or Mollie and have Bill or Mary show them how to perform their 
tasks. The foreman would say that in a day or two the new employe was 
doing well and O. K., or that he or she was hopeless and replace with another 
new employe, and the endless chain kept moving. 

Here and there, as competition became more keen, the up-to-date man- 
agers began to heed the advice given by students of the labor situation and 
began to devise labor systems for new employes. These training systems 
in most large concerns include the selection, placement and individual train- 
ing of the new employe. These plans have extended to the point where 
many of us send representatives to all the leading Universities each spring 
and attempt to sell our organizations to the students. After interesting the 
students in our lines, then we select those who seem fitted for our needs 
and when they report they are given from six months' to four years' train- 
ing for the positions to be filled. Why the training, you may ask? Because 
schools or universities may turn out engineers or highly educated men and 
women — but they cannot be expected to give training in individual lines. 
If there is a criticism, however, which I could utter against our universities 
who teach commerce and business courses — it is that too little attention is 
given to developing the executive qualities which a student may possess. 
Just as these plans have gone to the universities, we have extended to the 
public and high schools to find those students who are adapted to our lines 
and who are not to attend universities. When they come to us — The Cor- 
poration School does its share to teach them the ins and outs of business. 
For those who may have finished public school, but for financial reasons 
are unable to attend or complete high school, the Corporation School has 
developed the co-operative schooling plan, whereby the students working in 
pairs alternate at regular intervals one at work in the plant being trained 
either in commercial lines or a trade, while the other is acquiring that edu- 
cation to which all of us are entitled. Dean Schneider, of the Cincinnati 
University has developed this plan with remarkable success to give his 
students actual shop practice. 

For those younger boys and girls, where it has been impossible for 
the parents to permit further attendance in school the Corporation Schools 
have encouraged attendance at night school, and in many instances have 
organized evening schools to teach the necessary subjects for the youngsters 
to finish the eighth grade. 

Many of us have organized and maintained evening schools where ambi- 

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The Importance of the Human Factor in Industrial Preparedness 



tious employes may learn the fundamentals of the particular business they 
may be in. 

The Corporation School movement is rapidly gaining ground and to aid 
in the movement, The National Association of Corporation Schools was 
organized four years ago. This association has 104 firms or corporation 
members: General Electric Company, Pennsylvania Railway Company, 
National Cash Register Company, Curtis Publishing Company, International 
Harvester Company, Swift & Company, Ford Motor Company, Carnegie 
Steel Company, etc. 

This association was formed primarily for the dissemination of informa- 
tion between members about both successful and unsuccessful educational 
plans. It now has permanent committees on, Public Education, Vocational 
Guidance, Employment Plans, Office Work Schools, Trade Apprenticeship 
Schools, etc. 

The Corporation School movement is a part of the general efficiency 
movement, and will render its share of service to our country in this time 
of need. 

For fear of getting over my time I want to end by saying that the move- 
ment in Chicago particularly has gained such ground that there are ten 
firms in Chicago, all over the million dollar class, who conduct schools with 
paid people in charge of them and paid teachers giving full time to the work. 
(Applause.) 

CHAIRMAN SEGUR: I am sure that we have enjoyed very much this 
talk by Mr. DeField on Corporation Schools as well as the talk on safety 
by Mr. Porter. 

One of the questions which all manufacturers are thinking of very 
seriously is the question of women and how women can be used in their 
industries. I never think of women's work in war time, however, but what 
I think of the two Irishwomen who had moved into England where their 
husbands came under the conscription act. Mrs. O'Flaherty was talking 
to Mrs. Maclagan the next day: "Good morning, Mrs. O'Flaherty, and has 
your husband been called up yet?" "No, thanks, he has not been called 
up. I guess he is too hard to be called up. I have been trying to call him 
up every morning for fifteen years to get of! to work, and I have not gotten 
him up yet, and if his wife can't call him, I expect no one can't. (Laughter.) 

I expect there are a lot of women in the United States who have a hard 
time to call their husbands up in the morning, but I do not suppose this is 
what Mr. MacArthur is going to speak of this afternoon. I have great 
pleasure in presenting to you Mr. W. S. MacArthur of Armour & Company. 
(Applause.) 

MR. W. S. MacARTHUR: Mr. Chairman, members of the Western 
Efficiency Society : I am not going to take up your time with a lot of 
details this afternoon in regard to women's work in war time, for after 
what the chairman has said I am afraid that you would be in about the 
same mood as the men of whom Mr. Howard told about at Philadelphia. 
Everybody was waiting at a ticket office ; there was a long line of people. 
A man rushed up, got in ahead of the line, threw down a dollar and said, 
"I want a ticket to Chicago." Everybody along the line got out and looked 

161 



The Importance of the Human Factor in Industrial Preparedness 

at him, and the ticket agent says, "You cannot go to Chicago for a dollar." 
"Then where can I go?" And everybody along the line told him. 
(Laughter and applause.) 

I do not want to be placed in that position. What I want to do this 
afternoon is to give you a very brief talk on the subject of women's work 
as it has appeared to me from observation and study, especially in the last 
six or eight months, giving you a little outline of the way in which it has 
affected Great Britain and France, Great Britain particularly, and the manner 
in which we expect it is going to affect us. 

WOMAN'S WORK IN WAR TIME 
Mr. W. S. MacArthur 

MR. MACARTHUR: Mr. Chairman, Ladies and Gentlemen: The 
subject of Woman's Work in War Time has been suddenly thrust upon the 
industrial world for consideration, and it is the most important, from a 
commercial standpoint, which we have to analyze at this critical period. It 
is a question that we all hesitate to consider, but it is something that will 
not down, and the time has come when we can no longer dodge it but must 
consider it in all its phases. 

It will no doubt be conceded by all, that the year 1912 was what we 
may term the last normal industrial year. 1913 saw the beginning of finan- 
cial and industrial disturbances, which was arrested by the outbreak of the 
world conflict in 1914, and has since been converted into a period of business 
expansion and prosperity never before equalled in the history of the country. 

The sudden stopping of immigration, at the beginning of the war, had 
an immediate effect. There was a quick and sharply defined industrial re- 
adjustment. Employers inaugurated a policy of retrenchment; operating 
expenses were cut to the limit and the labor force reduced to the minimum. 
Before this resulted seriously, the expansion of business in the east, due to 
the immense orders for war materials, and the bumper crops of the middle 
and western states, absorbed the various elements which threatened for a 
time to disrupt the business world and shake our commercial structure to 
its foundation. That is past. If Industrial America will now retain her 
grip and keep cool, not allowing herself to become excited over our entrance 
into this world struggle, there is no reason why we should not experience 
an even greater business expansion for an indefinite period, for I am a 
great believer in the good sense and sound judgment of the American busi- 
ness man. 

America has been known the world over as a favored nation, and this 
was never, more thoroughly demonstrated than at the present time. Instead 
of our having to enter this conflict, unprepared and absolutely without experi- 
ence, we have had placed before us the almost three years' experience of 
Great Britain, France, Russia and the other Allies, so that we can make our 
plans with the knowledge that we can save ourselves untold suffering and 
expense, if we will. The early experience of our Allies must never be allowed 
to repeat itself here. 

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Western Efficiency Society Conference 



It is imperative that individual zeal and patriotic fervor give way to 
collective effort with its centralized responsibility. 

When Great Britain found itself in this, the greatest war the world has 
ever known, and the like of which we fervently hope will never be seen 
again, there was a nerve racking period of anxiety and distress while the 
country pulled itself together, gathered its resources and organized for the 
supreme effort required to snatch victory from its enemies. As the nebulous 
theories and latent resources took shape and developed into concrete plans, 
there arose a murmur from. her millions of women which swelled into the 
mighty chorus, "What can we do to help?"' 

This same question is being raised in America today, and we will no 
doubt find our solution in Great Britain's answer which has been clearly set 
forth by Capt. John Hay Beith of the British Army in a current periodical 
in which he says "that with the hard experience of the older Allies as a guide, 
the women of America should have no difficulty in recognizing the need of 
organizations, co-ordination and standardization of their noble efforts." 
Human nature is alike the world over and history is constantly repeating 
itself so we have no reason to believe that it will not do so in this case, 
but we can avoid a great deal of trouble if we learn our lesson from the 
experience of the European countries. 

It is true in America as it was in Great Britain, that so far as the men 
are concerned, the problem is simple indeed. No man, especially one of 
military age, has any doubt as to what he can do. The elevated trains, street 
cars, automobiles, and in fact every public conveyance and bill-board, em- 
phasize the fact that the Navy needs him now, or that the Army awaits his 
enlistment. 

For women this matter is not so easily decided. As Capt. Beith so 
tersely puts it : "A woman's thoughts in war time turn naturally to one sub- 
ject, and one subject only, the alleviation of pain and suffering." 

We are now in the midst of an intense campaign for the Red Cross, 
a movement which in this country has not been as widely supported as 
abroad. This, of course, due to the fact that its necessity was not so forcibly 
present here, as with the countries of Europe, which for years past have 
been living on the edge of a volcano. There is hardly a city or hamlet in 
our country, where societies of women have not already been formed for the 
rolling of bandages, the stitching of antiseptic pads, and the thousand and 
one other activities which are so necessary. The Press is filled with reports 
of meetings of clubs, societies and various organizations, whose sole purpose 
is the raising of money to purchase materials for the manufacture of com- 
fort kits and other necessaries for the sailors and soldiers which our Gov- 
ernment does not provide. While these efforts are to be commended, so 
great has the movement become that we are in danger of overlapping and 
wasting by misdirection, an immense amount of energy and skill which, if 
properly applied, would be vastly more efficient. 

We are making every effort to centralize responsibility, and organize 
our tremendous resources in such a manner that we would obtain maximum 
efficiency from the effort expended. The plan formulated by the President 
of the United States and by the Congress for bringing to the service of the 

164 



The Importance of the Human Factor in Industrial Preparedness 



Government, the brainest men and women in the country, through the Com- 
mittee of National Defense, will accomplish that for which we are so earn- 
estly striving", viz. : profiting by the experience of our Allies, avoiding their 
mistakes which would naturally have been ours under similar conditions, 
and the utilization of every ounce of our strength, both material and financial. 

Among those who have studied the subject there has been the feeling 
that it would not be long before our Government, in response to the insistent 
demand of the women to share in the war's work, would adopt a plan for 
the registration of women so that their energy can be conserved and properly 
directed. Doubtless you saw in one of the morning papers yesterday, an 
article stating that the United States is to register all women for service 
in the war, and that a national organization is to be formed for this emer- 
gency. A voluntary registration day for women is to be established, accord- 
ing to an announcement sent out by the Woman's Committee of the National 
Council of Defense. The various committees of the National Council are 
working daily on the task of organization, and will keep in close touch with 
Washington officials, giving out bulletins from time, to time, which will be 
in the nature of instructions. Time will not permit of our entering into 
detail, but it will be sufficient to say that this registration and organiza- 
tion, when fully completed and in working order, will have gone a long way 
in solving the problems that confront the women of the country today. This 
plan of the Woman's Committee of the National Council for Defense is in 
line with and follows the plan adopted by the British Government through 
their labor exchanges and other government organizations. 

It was said during our civil war that it would have ended long before 
it did, had it not been for the devotion and intense loyalty of the southern 
women to their cause. In the years that have passed since then, the life of 
greater luxury to which we have been accustomed has not in any way abated 
the feeling of loyalty, and the spirit of self sacrifice on the part of the women 
of today. We see them with buttons and flags, and with various mottoes 
pinned across their breast, urging men to serve their country in the way 
they are best adapted. We see them with the recruiting officers, enthusi- 
astic and earnest, bringing home to the men their responsibility. They are 
all consumed with an intense desire to do something, but their efforts would 
be productive of greater results if they only knew what to do, how and 
when to do it. 

This was the experience of Great Britain and France at the beginning 
of the war and continued until the Government stepped in, took over the con- 
trol of the various activities and centralized the responsibility. Since then, 
as the author previously referred to states : "The springs of patriotism and 
voluntary service are flowing more abundantly than ever, and now they 
are directed into properly appointed channels. No longer are some fields of 
charitable endeavor inundated or drowned out, leaving- others dry and barren. 
Organized effort and regular distribution are the order of the day. All War 
Relief Societies are registered; unauthorized collection of money, especially 
in the streets, has been made illegal. Superfluous and spurious societies have 
died a natural death." 

As the war developed, and the need for men became more acute in 

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Western Efficiency Society Conference 



Great Britain, clerks were withdrawn from offices, banks, hotels and other 
places, and were succeeded by women. It is hard for us in this country to 
realize to how great an extent this has been done. In the Liverpool office of 
Armour & Company, out of 70 men who were in our employ at the outbreak 
of the war, only three or four are now left, their places having been taken 
by women, and it has been a hard fight to retain these few for all of you have 
no doubt noticed from the papers that no male clerks can be employed in 
Great Britain between the ages of 18 and 61, except with the consent of the 
National Service Director, and such consent is not obtainable unless an 
extraordinary strong case can be brought. 

The gorgeously uniformed men who stood at attention at the curb and 
opened the carriage doors, telegraph messengers, postmen, and even boot- 
blacks, have gradually melted away like snow in the sun, and girls and 
women have succeeded them. 

Are we to face the same situation ? Those of us who were privileged 
to attend the Conference at Philadelphia a couple of months ago to discuss 
Labor and Employment Problems, were deeply impressed by the statement 
of a member of the Committee of National Defense, who came direct from 
a twenty-four hour session of his sub-committee at Washington, when he 
said that the Govern ent was not looking for an early termination of the 
conflict, and that no contracts were being entered into except upon a three 
year basis. We may well stop to consider the future of the industrial situa- 
tion in the United Spates if the war is to continue for the period mentioned, 
or longer. 

The first call for men under the selected draft has been made. We 
are soon to see the registration of all men of military age, and the problems 
that we can now see confronting us, are worthy of our most serious con- 
sideration. 

In bringing women into the industrial held to replace men who have 
enlisted, or who will be drafted for military service, there are many prob- 
lems to be faced and settled if we are to brine; acout this great change with- 
out serious disturbance of the industrial work. As the increased labor de- 
mand has in a measure kept pace with our industrial development hereto- 
fore, the difficulties which have arisen from time to time have been met and 
solved without trouble, but the sudden upheaval of all our fixed ideas, due 
to the world conflict, has taken us so by surprise, that we have been dazed 
into seriousness. But, whatever happens, we know that it is going to do our 
country good, as it did Great Britain in bringing her to realization of the 
condition to which she was rapidly passing, and stimulated her national life, 
in a manner earnestly sought but scarcely hoped for. Just so, this time of 
stress and industrial change through which w r e are now passing, will awaken 
our national life and ideas, and break down ideals and customs which were 
rapidly fastening themselves upon us as fetters. 

So far as the United States is concerned, it is hardly possible as yet to 
say to what extent the increase in the number of women employed has been 
due to women taking the place of men, for we must bear in mind the fact, 
that there has been an extension in the number employed in certain women's 
occupations. On the other hand, Ave learn that in Great Britain since the 

166 



Th e I mportance of the Human Factor in Industrial Preparedness 

war began, the number of women employed in industrial occupations has 
increased by nearly 150,000 or practically six per cent, while the substitu- 
tion of womn for men in clerical and commercial occupations is known to 
be considerable, a statement endorsed by the fact that during the 13 months 
ended October 15, 1916, the labor exchanges alone had placed nearly 350,000 
women in employment. Whatever view may be taken of the matter in 
regard to industrial occupations, there can be no doubt that a steady and 
increasing displacement of men by women has taken place in non-industrial 
occupations, and so far, women have not been employed to any great extent 
in the heavy trades nor have they yet, as far as it has been possible to ascer- 
tain, been given positions of responsibility over men. 

A. W. Kirkaldy, editor of "Labor, Finance and War," stated in April, 
1916, on ,the authority of the Council of the British Association, that at that 
time, 523,000 women were directly replacing men, and 737,000 women were 
replacing the men, either directly or indirectly. The entire labor world 
quickly shifted its opinion from one of doubt to that of amazement, at the 
results obtained when women were first introduced to the munition manu- 
facturing industry. Today the volume and quality of their work has con- 
vinced everyone that without the assistance of women in the industrial field 
it would be impossible for Great Britain and her allies to win the fight. It 
has been found that women will turn out as much work, if not more, and in 
some cases a better finished product than men, if provided with necessary 
lifting appliances so that they are not subject to undue physical strain. 

A critical study of the results of the forced employment of women, 
showed that those who had been previously occupied in gainful pursuits, 
attained a normal output with less expenditure of strength than those who 
had not previously been wage earners, and that the output of the younger 
women and girls, was greater than that of the older ones, this decrease in 
output due to age, beginning very much earlier with women than with men. 

The demand of the time brought about the designing and creation of 
practically fool proof machinery, and in various manufacturing processes a 
great increase of semi-automatic machinery, with a necessary re-arrangement 
of duties, bringing additional operations within the strength and capacity 
of women. 

Superficially, women present the same human nature as men, but there 
are certain points of difference which require certain consideration. For one 
thing, they are more self centered, and if they are to give of their best, need 
to be encouraged to do so. The very combativeness and ambition of the 
male drives, him onward, but to get the same results from women they must 
receive indirect suggestions, and when the work is at all complicated, 
special instructions. In some positions women are vastly superior to men, 
and for others the reverse is true. 

In our own plant it has been found that many of our female employes 
are among the swiftest piece workers, and best wage earners. We have 
many classes of work that are specially adapted to women, such as labeling 
cans and jars, painting cans, packing meats in cans, jars and cartons, 
trimming sausage meat, light packing work, etc. Manv of these jobs are 
on a piece work basis and, due to the deftness of the female worker, they 

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Western Efficiency Society Conference 



have very substantial earnings placed on their credit at the end of each 
week. 

To those who are familiar with modern factory methods, it is not sur- 
prising that women can do certain work. The impression prevails generally 
among the public that the* great armies of men operating the machinery of 
our manufacturing plants are machinists; that a man who has served a 
sufficiently Jong time in the shops would be skilled in the operation of 
machinery and tools and familiar with mechanical processes generally. How- 
ever, this is far from the truth. The number of men who are capable of 
taking an ordinary working drawing and carrying out its many, and often 
intricate requirements is decidedly limited. They are in a class by them- 
selves and are known generally as tool makers. In every shop operating 
on a manufacturer's scale, there are men known as machine setters, whose 
duty it is to prepare each machine to perform some particular operation or 
series of operations. They attach the "fixtures" where necessary, adjust 
the cutting tools to their proper position and see that the required jigs and 
gages are at hand. In a very short period of time they can show an en- 
tirely inexperienced man, of average intelligence, how to place the rough 
piece in the machine, stop and start it, and after that all the operator has 
to do is to put in the rough part and remove the finished article, testing it 
by means of fixed gages. It is this development in the manufacturing trades 
that has enabled women to take up the work where the men left off, and 
handle it in the able manner that they have done. Even in the case of farm 
work ; modern machinery has eliminated the laborous tasks of former years 
and makes the employment of women both possible and advantageous. 
Mowers, reapers, plows, harrows, hay-loaders, etc., provide for compara- 
tively light handling with the operator riding the machines. A woman is 
usually dexterous but does not grasp the mechanism of machinery as readily 
as the average man, which makes her more liable to injury than in the case 
of men. It is of course impossible from a physical standpoint to have long 
sustained operations, for, as a general rule, a machine operator is unable 
to sit down, especially when attending several modern, automatic machines. 
In Great Britain it was necessary to shorten the hours of work besides 
making many provisions for personal comfort and convenience that never 
would have been thought of in the case of men, even by the most theoretical 
philanthropists. 

The establishment of a centralized bureau for the registration and direc- 
tion of women as proposed by the government, would enable us to place 
them where most needed, in the same manner that Great Britain did. During 
1914 the number of women who obtained employment through the emplov- 
ment exchanges alone was 33,000; in 1915 the number increased to 53,000 
and in 1916 to 160,000. These figures merely indicate a transference of labor 
from one village to the next, or from one district of London to another, and 
at the present time the number of women being transferred away from 
home, through the employment exchanges to work at a distance, amounts 
to between four and five thousand a month. This illustrates the increasing 
mobility of women's labor, due to war conditions. 

In the early days of the war, the women thrown out of employment 

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The Importance of the Human Factor in Industrial Preparedness 

in pottery -districts were moved to silk mills in neighboring towns, and cot- 
ton operatives and carpet weavers were transferred to the Yorkshire Woolen 
Mills, and tailoresses from Cambridge, Cardiff, Belfast and elsewhere were 
imported into Leeds for work in the local clothing factories on army uni- 
forms. In the West Midlands district alone, where before the war the migra- 
tion of industrial women was practically unknown, over 4,000 were, in 1915, 
placed by employment exchanges in employment, away from their own 
districts. In the majority of cases the occupations were entirely new to the 
workers who were drawn from diverse occupations. During the summer of 
1916, partly as the result of a specially organized scheme for vocational land 
workers, over 1,200 women were moved to rural areas for fruit picking, har- 
vesting and other seasonal work ; this in addition to the very large numbers 
who were found permanent employment on the land. 

Special propagandist campaigns have been undertaken, appealing to un- 
occupied women in non-industrial areas, remote from the center where their 
labor is required. As a general result, the employment exchange authorities 
are able to guarantee that no woman is sent forward for employment away 
from home, without suitable arrangements having been made as to reception 
and transit at the other end, lodging or hotel accommodation, and general 
welfare. Women submitted for work in national factories have to pass a 
medical test before they leave home, and in all cases before proceeding on 
their journey are fully informed as to the conditions of employment, details 
of the journey, the address of the exchange at the other end, and the nature 
and approximate cost of the lodging accommodation available. 

The experience of the last three years has shown beyond question that 
women are capable of doing efficiently a large proportion of the work here- 
tofore performed by men. The problem that confronts us today is how 
best to utilize the women workers and to what extent we can employ them. 
With the growing scarcity of labor, due to the tremendous business expan- 
sion, the stoppage of immigration for nearly three years, and the mobiliza- 
tion of men for military service, there is no question but we will be compelled 
to employ women in place of men to a vastly greater extent than we had 
ever dreamed of. 

Those of you who heard Mr. Magnus W. Alexander speak at the recent 
meeting of the Chicago Employment Advisers' Club, will recall his state- 
ment that if the working day were to be shortened, as some organizations 
are striving for, it would be necessary to employ some eight million addi- 
tional workers to care for the present production, without taking into con- 
sideration the war, or the natural normal business increase. 

Where could such a vast force be obtained? With the entrance of the 
United States into the war, and the removing from industrial pursuits of 
hundreds of thousands, if not millions, of men, we must take immediate steps 
to obtain and train women workers for both office and factory, if we are 
to handle business as usual, without a serious disturbance in the industrial 
and financial world. Mr. Alexander told us of the plans formulated by his 
own company for the establishment of an apprentice system for Women, for 
it had been found by their experiments that women could handle their nine- 
inch and fourteen-inch lathes as well, if not better, than the men, if pro- 

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Western Efficiency Society Conference 



vided with necessary mechanical appliances for lifting and carrying the 
material. 

Other concerns are working along the same line. I recently spent some 
time with employment men in New York and Philadelphia and found that 
they were already employing women, breaking them in for various positions 
so that they would be ready when the time came. 

Some time ago Armour and Company began to employ women and place 
them in training to fill positions in the office, of the men who are now being 
called out, and by taking steps early we have without doubt prevented seri- 
ous disturbance, so far as our own office and plant are concerned. Com- 
paratively few business houses have awakened to the seriousness of their 
position. Only last week one of the largest railway systems in the south- 
west, not content to issue mail instructions, wired every division agent, sup- 
erintendent and yard foreman, to proceed immediately to employ women at 
every point where they could be used so as to prepare them to take up the 
duties of the men that they knew would be called to the colors. 

Probably you have noticed in the newspapers, the last few weeks 
especially, the large number of advertisements for women, many of them in 
display type, indicating an awakening sense of the danger with which we 
are confronted. There are hundreds of thousands of women, like the men, 
who have utterly failed to grasp the seriousness of the struggle in which we 
are engaged, and who do not realize, even to the slightest extent, the effort 
that we will be compelled to put forth and the intense mobilization of all 
resources required. But, we must ever keep before us the fact that it is 
necessary to create a state of mind among the women, which will make them 
see the necessity for concerted and centralized effort, or we will never accom- 
plish the purpose in view. 

Let us not delude ourselves with the idea that our present industrial 
difficulties are to change in the near future ; they will undoubtedly grow 
worse before they grow better. With the almost positive knowledge that 
this war will last several years longer, and that it is extremely doubtful if 
European governments will permit their men to emigrate to this country 
for a number of years after the war ends, we must make up our mind that 
the conditions under which we have operated heretofore have gone possibly 
forever, and that we must adapt ourselves to the changed conditions im- 
mediately. 

CHAIRMAN SEGUR: I am going to say for the next speaker he has 
my hearty co-operation and support. I have been for sometime in Chicago 
studying conditions that exist here. My studies have taken me to the 
various laboring sections here, where I know conditions, and I know the con- 
ditions are far less due to any lack of income than to a lack of knowledge 
of how to spend that income, and that the inefficiency that we have here in 
Chicago in many of our factories is due just to the things that I expect Mr. 
Stauffer is going to talk about. But nevertheless, I am more or less re- 
minded of a little thing that happened sometime ago, at least they say it 
happened, that Mrs. O'Leary asked Mrs. Mulligan what she thought ot 
dress reform and Mrs. Mulligan said: "Sure, it is a great thing. I just 

170 



' The Importance of the Human Factor in Industrial Preparedness 

reformed the old man's pants to lit Johnny, and it worked out fine." 
(Laughter.) 

I think that perhaps this war is going to reform some big problems. I 
take great pleasure in introducing Mr. StaufTer of the Fox River Efficiency 
League, who will speak on ''Prohibition as a War Measure." (Applause.) 

MR. STAUFFER: Mr. President, fellow promoters of efficiency: It 
is my business to combat alcoholic exhibitions in Wisconsin, a somewhat 
moist state. I lived in Milwaukee for six years, and probably you have not 
all heard the story I am going to tell you about Milwaukee. This is the 
story : A stranger, probably from Chicago, walked into one of our big 
stores one day and was looking around the book display, and not seeing what 
he wanted to see, asked the clerk whether he did not have Shakespeare here, 
and the clerk said, "I don't know." He turned to the proprietor of the insti- 
tution, an old German, and asked him, and he said, "No, we don't get Shakes- 
peare here. We have Schlitz beer, we have Pabst beer. We have Gump's 
beer. But we don't get Shakespeare." (Laughter.) 

PROHIBITION A WAR MEASURE. 

New occasions teach new duties. The emergency we are facing makes 
the problem of producing an adequate food supply and conserving it the 
burning issue of the hour. 

Congress has wrestled with the question of prohibition during the war, 
and decided to put the proposition up to the President. The President has 
handed it to the newly appointed food dictator, Mr. Herbert C. Hoover. 

The manufacture and sale of all alcoholic beverages during the war 
should be immediately prohibited for the following reasons : I — Such order 
would save the grain now wasted by the breweries and distilleries. Last 
year about 108,000,000 bushels of grain of all kinds were thus used, which 
would feed seven millions of people one year — a number equal to the com- 
bined populations of Wisconsin, Michigan, and Indiana. Dr. Harvey Wiley, 
formerly Federal food expert, has estimated that the grain now annually 
wasted for liquor would feed the entire population of the United States for 
one month. The brewers' reply to this proposition is, that barley is not a 
food for man, and that after it has been malted it makes a profitable feed for 
cattle. Moreover, they assert that beer is a valuable food. 

My answer to them is (a) — Stop the conversion of barley into booze, so 
that farmers will sow the land now used in growing barley to wheat or corn 
instead. (b) — Beer is not a food in the ordinary sense. It contains from 
3^ to 4^4 ^per cent of alcohol, which is a food, but also a narcotic poison; 
and this poison renders it absolutely unsafe as an article of diet. 

At first the announcement that there was danger of a food shortage in 
this country made no impression whatever. 

Until recently we have had an unlimited acreage of virgin soil to draw 
from, and vast prairies on which to graze cattle ; but our tillable land is nearly 
all under cultivation. Even before the war we were beginning to realize that 
the era of cheap wheat and meat had forever passed. 

Suddenly we are brought fact to face with the fact that the situation is 

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Western Efficiency Society Conference 



really serious. Careless farming must cease. Our shamefully wasteful habits 
must give way to habits of economy in the use of food. 

The situation is made doubly acute by three years of war, which have 
resulted in the withdrawal of millions of men in Europe from productive 
work. Hundreds of vessels carrying food supplies have been sunk. Added 
to this is the fact that last year the wheat shortage was 360,000,000 bushels. 
This year it will probably be but three-fourths of a normal crop. 

Mr. J. Ogden Armour, a recognized authority on this subject, has put 
the case none too strongly when he said: "In my opinion, the most serious 
question before the country today has to do with producing and conserving 
food for next winter, and with laying the foundations for a food supply for 
the next few years to come. Not only a hundred million Americans, but 
many millions of Europeans are looking to us for bread and meat to hold 
their bodies and souls together. If we fail, terrible suffering stares America 
and Europe in the face. Nothing but unusually large crops of every variety 
and the most careful distribution and use of them will take us through the 
winter months without widespread suffering." 

In view of these startling facts the further wasting of grain for that 
which does not nourish is criminal shortsightedness and folly. 

II — Immediate Federal prohibition would release the 81,000 men now 
engaged in the brewing and distilling business and put them to the reputable 
task of raising food instead of raising cane ! There are in the United States 
289,000 saloonkeepers, brewers and distillers, according to Dr. Irving Fisher 
of Yale. 

The war has produced a very unusual condition of the labor market. 
(a) — Normal immigration, sometimes reaching one million a year, has stopped, 
(b) — Great numbers of foreigners have returned to Europe to take up arms. 
(c) — An army is being mobilized, which means the withdrawal of the most 
virile of our population from productive pursuits. From every quarter is 
heard the call for men. Many of the manufacturers in Milwaukee are short 
200 men, and are ready, in their distress, to hire almost anyone who pre- 
sents himself. In view of this abrnormal condition it is high time to set every 
able-bodied man and woman to such work as will supply the real necessaries 
of life. 

Ill — Prohibition will insure the maximum efficiency of the workers at 
home and the recruits at the training camps. This is of the utmost urgency. 
The motive to 100 per cent efficiency was never as strong as today. Every 
man who has a spark of patriotism must promptly respond to this demand. 
We must win a decisive victory at the earliest possible hour. In order to 
attain this end the men in khaki and the men in blue will be denied the use 
of alcoholic liquors of all kinds. In view of this fact it is the height of mean- 
ness and ingratitude for those who remain at home to raise food and make 
munitions of war for our soldiers to insist on indulging their appetites for 
booze. I do not believe the American people will be guilty of such baseness. 

To prolong this awful tragedy needlessly for a single day would be a 
crime for which our language contains no adequate word. But let us squarely 
face the fact that tardiness in the manufacture of munitions of war and ships 

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The Importance of the Human Factor in Industrial Preparedness 



for carrying- them and food to the Allies, or a shortage of grain here, will 
certainly postpone the day of victory , 

Finally, Federal prohibition should be immediately initiated, and strictly 
enforced for the reason that the adoption of such policy will result in the 
solution of our most urgent social problem — the elimination of the drink 
habit; (c) — with all its personal and social consequences. 

The psychological moment has come to urge this matter with the utmost 
persistence. In this crucial hour of our history, we must be 100 per cent 
efficient ; and because we MUST, we CAN. But this means abstinence from 
all that intoxicates. 

Even partially enforced prohibition in the dry states has produced the 
most gratifying results. The Governors of dry states and the mayors of dry 
cities freely testify to the effect that prohibition has brought none of the ills 
predicted, but has brought increased material prosperity, greater industrial 
efficiency on the part of the working men, fewer accidents and a decrease in 
prostitution and crimes of all sorts, ranging from 50 to 90 per cent. 

In view of the nature of alcohol the results could not be otherwise. 
Being a narcotic poison it paralyzes the brain and nerves. And the heart of 
the tragedy of alcohol is the fact that almost immediately after being taken 
into the stomach it strikes the moral center of the brain, partially paralyzing 
those nerve cells through which conscience functions. The immediate effect 
is blunted moral sensibilities — a condition which predisposes the user of alco- 
hol to every form of vice and crime. The man who drinks even a little, is 
partially intoxicated, i. e., poisoned. Therefore his senses are less keen than 
those of the abstainer. He is deficient in perception and memory. His 
nerves are unsteady. Hence, accidents ; and hence, the muscles are not equal 
to hard labor. These facts are all well known to all who have studied the 
effects of alcohol. It is evident, therefore, that actual prohibition enforced 
for one year in the U. S. would bring in such an era of economic prosperity, 
good health, industrial efficiency and moral betterment as would insure the 
continuation of that policy for all coming time. 

That which it has been impossible to gain by argument and persuasion 
may now be gained by a single stroke under the grim necessity of war. 

The solution of every other urgent social problem of the day must be 
postponed till we have the moral stamina and courage to solve the booze 
problem in the only way it can be solved, i. e., by the radical way of universal 
abstinence and national prohibition. For, abstinence may save the individual, 
but nothing short of prohibition can save society. 

We deplore the fact that the vast wealth of our country is not more 
evenly distributed; and we know only too well that the growth of the slum 
population of our great cities bodes ill for the future. But there will be no 
solution of this problem, so long as the government licenses a subtle poison 
that impairs the earning power of the working man, and makes him morally 
incompetent to use to his best advantage the money which he earns by hard 
labor. And alcohol is just as bad for the brain that is charged with the 
responsibility of management as it is for the brain of the working man. 
When the history of the labor troubles of this country shall be impartially 
written, it will be necessary for someone to say that the paralyzing, brutal- 

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Western Efficiency Society Conference 



izing effect of alcohol on employer and employee was largely responsible in 
many cases. And this is true because the only lasting basis of industrial 
peace is justice and the spirit of brotherhood and co-operation between the 
employer and the employee. And a fine, clear sense of justice and large- 
mindedness are impossible in the case of brains that are partly paralyzed. 

The root of the child labor problem is the booze-drinking of the child's 
father. While crime is gradually decreasing throughout the civilized world, 
in this country it has steadily increased in the last 50 years. 

The first step in the solution of the problem of crime must be to quit 
making and selling beverages which paralyze the moral center of the brain. 

Thus it will be seen that alcohol is the root of these outstanding prob- 
lems which challenge the noblest intellects and the finest spirits of our time. 
What has been said of these, is also true of the housing problem, the divorce 
problem, the safety first problem, and the problem presented by the social 
evil. Not one of them can be solved as long as the present drinking customs 
prevail; for, booze is the root of the trouble in each case. In fact, booze is 
the prince of all the modern evils that trouble us. Cast him out, and all the 
lesser brood will flee with him. Give him place, and vain will be all our 
laborious efforts at reform. The demand of the hour is for a patriotism radi- 
cal enough to go to the root of our troubles. 

Morality is absolutely essential to preparedness, and industrial and mili- 
tary efficiency. Booze, tobacco and venereal disease are sapping the life of a 
vast number of the young men of military age. My only reason for stating 
this disagreeable fact is because of the very close relation there is between the 
use of alcohol and sexual immorality. . Many of our young men are wholly 
unfit for the best service in the shop or on the field, because, after paralyzing 
their brains with booze, and thus blunting their moral sense, they found it 
impossible to control the sexual impulse. The chaplain of one of our Wis- 
consin regiments, which served on the Mexican border last year, says that 
three out of five of the soldiers under his charge came home with some form 
of venereal disease. A moment's reflection on the tragedies which will inev- 
itably follow the return of these men to civil life gives one pause. On their 
return from the east the crusaders brought with them the dreadful disease 
syphilis, which spread all over Europe, and which for a time threatened to 
destroy Western civilization. 

For the young men on whom the destiny of the nations at war rests, the 
only way of safety, health and efficiency is total abstinence from all that intox- 
icates. And I do not think it fair or honorable to force on them a severer 
standard of self-denial than we ourselves are willing to adopt. Prohibition 
will make it easier for all men, whether at home or at the front, to be clean 
and efficient. 

And if, as a result of the war, we shall be compelled to adopt nation- 
wide prohibition, the beneficial economic and moral effects will be so vast 
and far-reaching as to justify the awful tragedy which is darkening the world 
at this very hour. 

The hour of destiny is at hand. Let us strike a well-aimed blow at the 
chief evil of modern society. Let us strike now, and let us strike hard for 
national prohibition as the only adequate remedy for a national evil! 

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The Importance of the Hum an Factor in Industrial Preparedness 

CHAIRMAN SEGUR: In introducing the next speaker I want to say 
that I have obtained a great deal in what little I have been enabled to do 
from Mr. Gilbreth's work and what he has written. I believe I got my first 
ideas on standards from Mr. Gilbreth's books. I think probably there are 
other men here in the audience who have had the same experience. I have 
heard Mr. Gilbreth speak many times and I think we all of us know there is 
something good coming. 

_ Mr. Gilbreth, the program states, will talk on "Measurement and Stand- 
ardization/' but this address he has had printed and copies will be distributed. 
However, we are to have the pleasure of seeing some of Mr. Gilbreth's micro- 
motion pictures, and as these will be more interesting than anything I could 
say I will call on him. 

MR. FRANK B. GILBRETH: While they are making the room dark 
I want to contribute a little something which will make my friend Adams 
laugh himself to death and Harrington Emerson get up and go downstairs, 
and a few other things like that. (Laughter.) I want to tell you that this 
work which my friend Harold Gould called long haired, and it was not denied 
by Dean Hotchkiss, — that this work of mine, if it has not done anything 
else, has done one thing that will please the previous speaker, and that is that 
it has proved that booze is the biggest enemy we have got from A to Z. 

There is not any kind of booze in the world that I don't like. (Laugh- 
ter.) I do not believe there ever has been any kind of booze made, and I do 
not believe there ever will be any kind of booze made that I do not like. 
(Laughter.) As a friend has said a few minutes ago, I wish I had a drink 
right now. (Laughter.) 

And in spite of that fact, I have cut out booze, and every time I see a 
man drink it makes my mouth water. (Laughter.) I do not know whether 
I will be able to stick it out or not. It does not seem to get any easier for me 
as time goes on. Incidentally, it does not get any harder for me, but we have 
been making measurements in our various laboratories, of which we have 
nearly a dozen in this country at the present time, that have given us some 
interesting information on its by-products, and information that we never 
expected in the world we were going to get. The fact that you can actually 
see the difference in the kind of motions and the decisions that are made by 
the man who boozes just a little and the man that does not booze at all. 

Now, looking at my carcass, consisting of almost an eighth of a ton, as a 
machine I cannot afford to have any alcohol in it, until financial conditions 
change, at least. (Laughter.) There is a new one for Mr. Prohibitionist. I 
have been anti-prohibition all my life. It always seemed wrong to me to 
have another man tell me whether or not I could have a drink, and finally I 
got to the point that the long life in Germany made me believe that light 
wines and light beers do not do any harm, and so I thought that the prohibi- 
tionists should compromise ; but I am becoming an uncompromising prohibi- 
tionist. (Applause.) Stop it. I see you boozers down there applauding. 
(Laughter.) 

Now, you have not a right to do that. Cut that out. You are doing that 
for some of the gang here. Now, go get a record and reputation like mine 
before you do that. (Laughter.) 

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The Importance of the Human Factor in Industrial Pre paredness 

I candidly and truly believe that the evidence we have got today on this 
motion study is a brand new contribution to the question of booze ; and I am 
not going to talk about booze any more. This is the first time I ever men- 
tioned it to anybody, except in groups of one at a time. (Laughter.) 

Now, getting down to this talk of mine ; I do not know whether I am a 
good fellow this afternoon or not. Many things will come up in a somewhat 
disconnected way in this talk of mine, because my program has been changed. 
I have got a paper here. I thought it was all off, because if I could not come 
at the last minute somebody would read it, and if I did come I would stand 
up and read it, and my troubles would 'be all over. But talking with the 
high-brow committee of the Western Efficiency Society today, they suggested 
I cut out the paper and give another talk, and consequently my talk has been 
a little bit disconnected, because Harold Gould, while I was arranging some 
lantern slides in my trunks, came up, and I did not have time to arrange 
them. If the Western Efficiency Society had been efficient they would have 
saved me from hearing the uninteresting papers preceding me and I could 
have arranged my slides properly. (Applause.) 

The Western Efficiency Society, consisting as it does of perhaps the 
largest executives in the country, makes it more important than ever that we 
think over what we are going to do in this crisis that confronts us at the 
present time. I have crossed Germany a half dozen times since the war 
began, and I believe I have been in nine different countries over there, some 
of them several times. And consequently being prepared to talk over the 
subject particularly of furnishing the grub and the munitions and the neces- 
sary transportation of the man behind the gun, being equipped to talk about 
that subject quite as well and probably a little bit better than any army or 
government officer that you can get, it seems to me that perhaps you can 
forgive me for having a disconnected talk, because I have got some things 
here that may start you thinking, even though they may not make a complete 
solution of the problem of what a civilian can do, what a manager can do, 
what an engineer can do, what an industrial commercial man can do, to help 
out the situation that confronts us in this country today. 

I have been in Washington three days since the war was declared". I 
have had a talk with a great many officials down there, and I have just come 
from several meetings in Cincinnati, from joint sessions of the American 
Society of Mechanical Engineers and the National Association of Tool Build- 
ers, and these subjects have, come to me and they have been talked over in 
these various places that I have been in. 

Now, I am going to show you some pictures, some of which are abso- 
lutely new and some of which are quite old, but I do not hesitate to show you 
these old ones for the third time, for the reason I have not seen an expres- 
sion of human intelligence on any man in Chicago that I have shown these 
pictures to up to date, — I refer particularly to Harold Gould and my friend 
Berndt. (Laughter.) Harold Gould says the scheme is long-haired. Any 
kind of hair sounds good to me in my old age. Consequently, we won't argue. 
(Laughter and applause.) 

Mr. Gilbreth then showed a number of stereopticon views and micro- 
motion pictures and gave an explanatory talk with each. All the lights in the 

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Western Efficiency Society Conference 



room being turned out, it was impossible for the reporter to take notes of 
Mr. Gilbreth's remarks. 

The paper specially prepared by Mr. Gilbreth for this conference follows : 

"MEASUREMENT AND STANDARDIZATION." 

No definite and permanent advance is made in any kind of work, whether 
with materials or men, until use is made of measurement. This is especially 
true of advancement of the human factor in industry, which varies so much 
that unless we use measurement and abide by the results, there is no possibil- 
ity of repeating the process accurately and efficiently at will, or of predicting 
and controlling the future conditions that assure that advancement. 

The first step in any great movement is to do exactly what this Society 
is doing at this Conference — to arouse interest in the subject, to discuss the 
great problems involved, to outline the possible solutions, and to assign the 
various problems to those best fitted to undertake and handle them. 

The next step is to realize that all this discussion, valuable as it is, can 
grow into such action as it deserves, only if measurement is insisted upon 
from the very beginning of making the investigations outlined, if the records 
of measurement are in such form that they can be used by those who did not 
make them, that skill and experience may thus be transferred, and if the 
results of the measurements are incorporated into actual and universal prac- 
tice as soon as they are properly synthesized into practical methods of least 
waste. 

The world has come to realize the truth of this as applied to material 
things. The day of standardization of materials and of machines is far ad- 
vanced, and is daily progressing; but such has been rarely the case with 
measurement as applied to the human element. 

The design of machines is constantly changing; the human being is con- 
stant. Measurement on machines that are obsolete is of little value. Measure- 
ment of human beings is valuable forever. Such old saws as "Genius must be 
unconfined and uncritcised," "Skill is not a matter of measurement or of 
teaching, but of natural aptitude alone," "Experience is the same as efficiency 
and the expert often develops as a lone workers and with no thanks to meas- 
urement," have stood in the way of measurement. So have such ideas as that 
measurement of the human factor, and the supplying of work that this meas- 
urement shows to be the most appropriate, lead to monotony. 

Now it is. a matter of no difficulty to state the facts in their proper terms 
to an unprejudiced and open mind. Measured investigations prove that 
genius develops best and fastest when provided with such opportunities as 
measurement of the genius show as necessary, and when relieved of all 
restrictive occupation and distraction. They also show that skill is largely 
a matter of training, and that greatest skill can be acquired in the shortest 
amount of time when right habits are acquired as a direct result of right 
methods having been taught from the start, and the human factor in the 
learner and the teacher having been carefully measured. 

Most interesting of all, perhaps, is that recent investigations prove abso- 
lutely that while expertness and efficiency may be possessed by the same indi- 

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The Importance of the. Human Factor in Industrial Preparedness 



vidual, often the expert is not an efficient worker. One of the most expert 
and most successful orthodontists in the country was proved by motion 
study measurement to be most wasteful of her motions and her strength. 
Many an expert worker in the industries, in the professions and in the sports 
shows every evidence of working with speed and with a resulting output high 
in quality and quantity, but with a resultant fatigue entirely incommensurate 
with real efficiency. This is no mere theory of ours, not something that we 
merely base on "what might be" or "what could be," or "what we believe is." 
It is the actual condition of affairs as we can prove by records made on rec- 
ognized experts and champions in numerous lines of activity. 

As for the idea that measurement leads, directly or indirectly, to monot- 
ony — it has been the direct results of measurement that have proved to be the 
great factors in eliminating monotony, and in injecting interest into all kinds 
of work. 

Monotony is the result not of measuring the activity, or the human factor 
in the activity, but of wrong assignment and placement to work, or of such 
repetition of work that the mind is forced to follow a cycle of activity again 
and again, with nothing to stimulate during the process. It is the measure- 
ment that has resulted in better placement, and in assigning each individual 
to that type of work for which he will become best fitted and that he finds 
interesting. It is the measurement, and the theory and practice of measure- 
ment that is taught the individual at the work, that makes him interested in 
the work itself, in his motions in performing it, and in the rest intervals that 
enable him to perform the most output with the least fatigue. 

How are these measurements made? Through advances in laboratory 
psychology, through educational psychology and through advances in labora- 
tory practice in the industries, it is now possible to record, accurately and in 
great detail, not only what the activity is, its elementary and over all times, 
and the paths through which it moves, but also the results. Progress might 
be greatly accelerated by closer co-operation between workers in various lines 
all interested in the same problems, though often they fail to realize this fact. 
Physiologists, psychologists, industrial engineers, managers, and other experts 
are all interested in so many of the same problems as to astound anyone who 
understands the various problems, and can compare the investigations in com- 
parative activity now being made. Yet many of the most prominent workers 
in all these lines, not to speak of the world at large, fail absolutely to realize 
that the problems being considered are common to all and that the results 
could be of use to the world very much quicker if there was more close co-op- 
eration during the period of investigation. Methods and devices could easily 
be transferred from one type of laboratory to another, findings could be corre- 
lated and results classified and utilized to an extent scarcely dreamed of today. 
As for the methods and devices in use in industrial investigations in par- 
ticular, we have already presented to you on previous occasions data concern- 
ing some of those that we use and have found most helpful. It remains but 
to say here that these are at the disposal of the nation in this emergency, and 
have been placed by us already at the national service. 

In order to illustrate and to make more concrete the need of measure- 
ment in considering the human factor, we bring to you today especially and 

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as one typical example of the whole the problem of the cripple — the war crip- 
ple and the industrial cripple — both of whom constitute elements seriously 
to be considered in the great problem of preparedness. 

Ever since various visits to the warring countries, particularly after the 
war, and an intensive consideration and study of the problem of the crippled 
soldier, we have put all possible time, with no remuneration, to the consid- 
eration of the problem of re-educating and utilizing the crippled soldier and 
the crippled worker of the industries. 

We realize fully that this is not the time to bring the problem of the war 
cripples before the youth of the nation in such harrowing form as to prevent 
enlisting, or in anywise diminish the militant spirit that must exist if our 
national plans are to be successfully carried through. We realize also, how- 
ever, that if this country is to succeed better than did the countries abroad in 
handling this problem, it must be seriously considered immediately by such 
bodies of mature men as this Society. No one realizes more strongly than 
do the workers in the re-education of the cripples abroad, the need of our 
nation preparing a Bureau or Department along this line. We had, only a 
few days ago, a letter from Professsor Jules Amar, the great French scientist, 
who is devoting his time and resources to this work, who has government 
backing and the most marvelous equipment, and with whom we have been 
co-operating in crippled soldier work for some time. In this letter Professor 
Amar urges that this country prepare itself not only along military lines, but 
along all other lines, for the proper handling of its soldiers. And the French 
have succeeded in this line with their remarkable ingenuity far beyond any 
other nation. 

We have a well-defined purpose in bringing this subject to the attention 
of this meeting, which will be brought out plainly at the conclusion of my 
paper. Let us here outline the things that have happened abroad and in Can- 
ada because there has not been sufficient attention paid to measurement of 
the human factor, and sufficient preparedness to handle the problems that 
have arisen. 

In the first place, there was a universal lack of realization of the great 
difference existing among the cripples, and of the need of placing each man in 
that work not only that he was best fitted to do, but that he would most 
enjoy doing, and that would arouse and hold his interest most successfully 
and permanently. In the second place, there was a lack of realization of the 
many more opportunities available for cripples than had been realized. In 
the third place, there was a lack of realization of the necessity of supplying 
the proper and fitting re-education for the productive output at the earliest 
possible moment, in order to bridge over the period of discouragement and 
despondency, and help the cripple to fit back into the economic world and 
its work. 

In the fourth place, there was a failure to impress upon the cripple, from 
the earliest possible moment, his likeness to other people and to other work- 
ers, rather than his differences, and, therefore, as a result, a failure to provide 
for that social element in the work that is necessary, if his permanent happi- 
ness is to result. In the fifth place, there was a failure to educate the gen- 
eral community as to what their attitude towards the cripple should be. It is 

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The Importance of the Human Factor in Industrial Preparedness 



along all these five lines that this preparation must take place, and every one 
of these lines demands the most accurate measurement of the human factors 
involved. 

First, then, the lack of realization of the difference between individual 
cripples lead in many instances to teaching them all the same kind of work. 
This was especially the case where the unfortunate choice was made not of 
work that was suitable, but of work that was easily taught, or worse yet, 
work that the available teacher happened to be able to teach. The mistake 
here was a particularly sad one, in that often this line of work was one that 
could not possibly appeal to anyone of a group of real men who had left real 
work in the industries or professions to g-o into the most strenuous of all 
activities at the front. It was unfortunate, also, that after the cripple had 
been taught, he was not in a position to look at his new work as a sporting 
proposition nor to earn an adequate living, nor was he at all satisfied to work 
permanently at the new work in which he had been most painstakingly 
taught. For example, many red-blooded men were seriously taught to make 
baskets, wonderful baskets, that all possible customers could easily go with- 
out, that were expected to be sold to people who bought the baskets through 
pity to help the makers, instead of as a commercial proposition (even our 
Indians have abandoned basket making because it is not sufficiently profit- 
able). Most men of the type who have the spirit to fight for their country 
might be expected to work on baskets so long as they have attractive and 
interesting teachers, but when taught a trade requiring the variable of char- 
ity to be present at a sale of the product, would prefer, in the long run, to 
drown their sorrows in the standard manner. It must be remembered, then, 
that it is necessary to find a man's job for these red-blooded individuals, who, 
with the new opportunities, will be as strenuous in their determination as 
when they charged the enemies' trenches. 

In some cases it is possible to assign a man to work which he has done 
before he had been injured, and to adapt the working equipment in such a 
way that he can make a satisfactory output at the work. In many cases it is 
possible to "re-educate" the man to do a type of work higher than any he has 
ever done. We have never, as yet, found a case where it was necessary to 
assign any man to work that could not be made interesting, stimulating and 
profitable. 

The "mental" workers present the simplest problem. The "manual" 
workers of some education are also easily handled. The difficult element to 
handle consists of those who have never had the benefit of education— the 
illiterates. But surprising results have been obtained in all countries, even 
among this class, where the individual to be placed has been studied with 
sufficient care. It goes without saying that the nature of the injury or maim- 
ing must be carefully studied, also, and that this, along with the study of the 
mental training, and most especially the ability to learn, must be considered in 
the placement. 

Second, as to the lack of realization of opportunities for cripples. In 
considering the cripple as a subject for placement, we must remember that 
there are many variables involved. There are the variables of the physical 
capabilities of the cripple himself, and of the possibilities of supplementing 

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such limbs and faculties as he still possesses with such mechanical devices as 
are used so successfully by Professor Amar. The most rapid survey of the 
illustrations of any of the several wonderful accounts of the work being done 
by him, show that he has carried mechanical adaptation and supplementino- 
of the capacities of the cripple to a truly marvelous extent. 

Another variable is the amount of adaptation possible with the working 
equipment that the cripple is to use. We have already given an account of 
the possibilities of adapting the typewriter through the use of a double key- 
board, of a supply of paper from continuous multiple rolls and other devices 
furnished us by the Remington, the Monarch and the Smith Premier Type- 
writer Companies, to the use of the crippled typist.* Another variable is the 
possibility of re-education, mental and manual, of the cripple himself. Along 
with existing, realized and unrealized, opportunities for the cripple are oth- 
ers that result from the creation of lines of activity not yet existing, but much 
needed for the community good, such as that of Dental Nursing. This we 
have already described,** and need only say here that it consists of taking 
from the unfunctionalized over-burdened profession of Dentistry the routine 
work of cleaning the teeth, and assigning this to properly trained and in- 
spected cripples, who will, under State supervision and after the instruction 
of experts, supplement the work of the dentist, add to the health and well- 
being of the community, and at the same time furnish dental prophylaxis at 
a price that the poor family can afford. 

It is along this line that we make our first plea to you for co-operation 
in finding jobs specially adapted to cripples. In your own particular occu- 
pation, no matter what it is, there undoubtedly exist opportunities for crip- 
ples, both discovered and undiscovered, and it is a part of your duty to your 
nation, and of your contribution to adequate preparedness, that you yourself 
discover these opportunities, record them and present them for national con- 
sideration. If you have a successful cripple in your employ, if you know a 
cripple who is a productive member of the community, his occupation must 
be one suitable for some other man crippled similarly, and it is your duty to 
record all existing data as fully as possible alon^ such lines, noting particu- 
larly how he has achieved economic and industrial success, that others may be 
cheered and encouraged particularly during their transition periods. If you 
note in your observation of your own activity, or your own line of work, any 
places that could be filled by cripples of any possible type, it is your duty to 
record these also. 

Of course, with the Simultaneous Motion Cycle Chart*** it is possible to 
take almost any line of activity and study it and adapt it in such a way as to 
place a crippled worker at least a part of the activity. But there is one way 
in which your observations will have more value than will those made 
through the laboratory methods, i. e., the great immediate need of the man 
who has been crippled, after he has been made ohvsically comfortable, is for 
*"How to Put the Crippled Soldier on the Pay Roll." Presented at the Economic 
Psycholos-y Association. Columbia University, New York. 

** "The Conservation of the World's Teeth: A New Occuoation for Crippled 
Soldiers." Conference Societv for the Promotion of Occupational Therapy, March, 1917. 
***Motion Study for the Crippled Soldiers." American Society of Mechanical 
Engineers 1915. 

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The Importance of the Human Factor in Industrial Preparedness 



encouragement and comfort. This can be obtained quickest through accounts 
of actual existing men who have suffered similar injuries and who have made 
good. If you will record these for his use in the most simple and elementary 
fashion, the human element there will at once make itself felt in the encour- 
agement and heartening of the newly made cripple. 

Third, you must realize the great need of supplying this incentive to live 
and this re-education at the earliest possible moment. Mr. George E. Bar- 
ton, Director of the Consolation House in Clifton Springs, New York, who 
has had a long, most interesting and valuable experience with cripples, with 
maimed, and with- convalescents of all kinds, agrees with us that the crucial 
period is at the earliest possible moment in the convalescence.* With the 
war cripples a serious complication occurs here if this stimulus is not at once 
supplied. In the case of those of much education and training, if there is no 
stimulus at this time, despair and direful consequences are more than apt to 
occur.. If the man has not much education or constructive imagination, and 
the period of re-education is postponed — between the money that he receives 
without effort, and the misdirected sympathy of his friends, he is apt to fall 
into habits of idleness, if not worse, that are extremely difficult to overcome 
later. This is universally acknowledged by those both abroad and in this 
country who have worked with cripples. 

Speaking of the money, or the pensions, it must be understood that noth- 
ing that we say in any way contemplates doing away with pensions. We 
agree with all those who sympathize with the cripples that they deserve — 
having "done their bit" — the thanks and reward of their country, and an 
opportunity to rest, if they so desire and if this is possible. However, the 
majority of them do not desire to remain idle, and it is necessary, for their 
own good as well as the good of the country, that they be allowed to supple- 
ment these pensions by all that they can earn and yet remain physically and 
mentally at their best. 

It is necessary at this time to realize, also, that ability to supply this 
need when it arises depends largely upon our being prepared well in advance 
of the immediate need. On returning from two trips abroad after an exten- 
sive study of conditions there, and strenuously advocating general prepared- 
ness for our nation, we were laughed at as mad and foolish for thinking that 
this country would be involved in the great tumult abroad. Now, when we 
again advocate as warmly and as persistently preparing for this crippled sol- 
dier problem, we are again told, even in Washington, that we are "in advance 
of the times" and that "there is no need for haste in this matter." We wish 
to impress upon this Society most strongly, at this particular point, the need, 
if we are to conserve the best there is in our returning men, mentally and 
physically, of preparing for their reception and their re-education at once. 

To consider fourth the need for a social element in the work. Too 
much of the work assigned to and taught to cripples carries the inference 
that they will work either as "lone workers," in their homes, or in communi- 
ties of cripples like themselves. Now, we all know there is no punishment 
like ostracism, there is nothing that troubles the average human being like 
being considered different from his fellows. We must make the cripple feel, 
from the earliest possible moment, that, in essentials, he is like every other 
*See papers by George Edward Barto*v Clifton Springs, New York. 



Western Efficiency Society Conference 



member of the community, and that the quicker he "fits back" into the social 
and industrial life of the community, the better for the community as well 
as for his own self. 

It is, therefore, with particular pleasure that we see some of the newer 
opportunities for cripples that are being discovered. We are glad to acknowl- 
edge here the hearty co-operation of the National Cash Register Company 
in discovering and recording such opportunities. There are opportunities in 
stores, opportunities for handling vending machines, for selling tobacco, 
papers, periodicals, candy, souvenir postcards ; for tending and operating tele- 
phones and telegraphs, telautographs, cash registers, credit files, dictaphones 
and circulating libraries; opportunities for selling booths in hotel corridors; 
opportunities in small stores, and as ticket sellers and choppers in subway 
stations. When you realize what these opportunities are, and the broad field 
in which they lie, you will discover numerous opportunities in your own 
organizations, and can co-operate and assist us in bringing these to national 
attention. The great benefit of all of these opportunities is that utilizing 
them for cripples will not only free people for other lines of activity that 
demand "whole" workers, but that the cripples will enjoy social life as well 
as opportunities for productive work for the community. 

Of course some suggested occupations will require the usual changes or 
adaptations. For example, an elevator operator's job requires no legs if the 
man be supplied with a stool. This is perfectly practicable in this country 
where there are no such ceremonies on entering and leaving a lift as exist 
abroad. 

This leads us naturally to the fifth topic, the need of educating the pub- 
lic. Whenever we suggest a line of work — for example, Dental Nursing — as 
well adapted to the work of cripples, we are sure to hear the objection, that 
"the public does not wish to be brought into such close contact with the crip- 
ple." It "will never stand for that." Now the public must be educated, at 
the earliest possible moment, to the realization that the cripple is already an 
unrecognized large portion of the community, as can be easily realized by 
noting the large number of factories devoted exclusively to the manufacture 
of artificial limbs, and is destined to become a large portion, as long as the 
war lasts and even after that, until we do away, as is possible to a greater 
extent, with industrial accidents. It is this feeling toward the cripple, which 
probably started in natural sympathy, and a desire to spare the cripple activ- 
ity, that has resulted in making the average cripple feel that he is different 
from the other members of the community, and estranged from them, and it 
is this feeling that we must combat at the earliest and at every possible 
opportunity. 

The pity for the cripple under the proper system of education should be 
supplemented by great admiration for the courage and expertness of the 
cripple, and by a desire to co-operate in making him a productive and a more 
satisfied member of the community. Again, the public must be educated as 
to the necessity of providing a definite livelihood for the cripple. It is not 
enough that we give the cripple a chance to earn a living, we must be sure 
that he gets the living. It is not enough to give him a "fair chance with 
other competitors," for he may not have been trained to meet the lifelong 

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The Importance of the Human Factor in Industrial Preparedness 



training of unhandicapped experts. It will be especially easy to emphasize 
the possibilities of giving and insuring this living to the cripples who are 
placed in these new types of little stores. This can be done, first, by send- 
ing the customers to him; next, by notifying all possible customers who and 
where he is; the "where" being taken care of by special signs on the street, 
such as druggists' signs in certain countries abroad; third, by notifying cus- 
tomers what he is ; fourth, by providing such state or community controlled 
societies acting as jobbers for cripples who are comparatively small buyers 
who can handle small orders for the cripple, handle credits and take away 
the voucher of "deserving cripple in good standing," or "military cripple in 
good standing." These jobbers will afford us an opportunity of guiding the 
distribution, purchasing and selling expense of those who are handicapped as 
original producers, and help to turn the necessary unproductive expense due 
to distribution marketing and service over to those who are handicapped. 

Again, the public must be educated to a feeling that after certain jobs 
have been designated as suitable for cripples they should, as soon as there 
are cripples to fill them, be reserved for these cripples. It should become at 
least "not fashionable" to do any work that can be done by a maimed man, 
nor to employ a whole worker in a job that can be properly handled by a 
cripple out of employment. 

This readjustment is no new thing, nor is it one demanded only by the 
situation with regard to cripples. We have for years advocated the reclassi- 
fication of the trades. This reclassification has always been needed. It hap- 
pens that this new element in the problem, or rather the increased impor- 
tance of this element at this time, makes the need for such reclassification 
and reassignment all the more important. 

These, then, are the various factors of the cripple problem as they exem- 
plify the need for measurement of the human factor, and we bring them 
before this Society at this time because your co-operation is so necessary. 
Experts as you are, each in his particular line, each of you is making at this 
time a fight for measurement, for standardization, and for adequate prepared- 
ness. We urge you not only to continue this good fight, and to advocate that 
measurement be applied to all lines, but we urge you to consider this neces- 
sity of measurement as applied to the placement of the cripple as an excellent 
starting point. 

The war cripple holds human interest today, anything that has to do 
with him grips the sympathies, and where the sympathies are once aroused, 
results will certainly follow, if we but persevere sufficiently. Now, there are 
two by-products to this, each of which is greater than the aforestated direct 
product. 

1. The industrial cripples are much more numerous than the war crip- 
ples. This has always been so, and is true even in Canada today. Let us 
therefore take advantage of the present interest and enthusiasm to handle the 
problem of the industrial cripple whom we will have with us always. 

2. The study of the special problems of the cripple, his capabilities for 
highest placement and success, his special and motion study education and 
guidance are better adapted to solve the problems of vocational guidance, 
placement, education and individual efficiency of the youth and workers of 

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Western Efficiency Society Conference 



our country than all other known sources combined. This is particularly 
well shown by the fact that each of the successful studies that we have com- 
pleted to enable the crippled to compete with the unmaimed has resulted in 
information or apparatus or less wasteful motions that have also been corre- 
spondingly useful and valuable for the unmaimed. 

In other words, the cripples' needs are immediate. In serving him we 
are at the same time collecting the most valuable motion study data, and 
data relating to educational and industrial methods of least waste. This is a 
National need that one can realize better after talking with a keen observer 
who has recently returned from foreign travel, particularly from the far East. 

Will you not therefore, in your consideration for, and in your work along 
the lines of the Human Factor in Industrial Preparedness, and in your advo- 
cacy of measurement along these lines, consider in your own particular work 
the military and industrial cripples, present and future, who need the results 
of this work so sorely, and co-operate, not only in finding opportunities for 
the individual, but in educating the great public with whom you come in 
contact as to the needs, and also to the remedies for these needs? By so 
doing you will add to the productivity and wealth of our country and to the 
great sum total of the happiness minutes which are the ultimate units that we 
all aim to produce. 



180 



EIGHTH AND CLOSING SESSION 

Friday Evening, May 25, 1917. 

PRESIDENT KESSLER: The meeting will please come to order. 

The Western Efficiency Society considers itself in a very enviable posi- 
tion this evening in having for its Chairman, the President of the Chicago 
Association of Commerce, Mr. O'Leary, who will take charge of the meeting. 
(Applause.) 

MR. JOHN O'LEARY: I was fortunate enough this evening to have 
dinner with my own family. When I announced I had to leave rather hur- 
riedly, they asked where I was going tonight. I told them to the Western 
Efficiency Society. And one of them remarked, "Why, you spoke there only 
a week or two ago." I accepted the rebuke, because I realized they meant 
they were rather surprised that I should be called on again. (Laughter.) 

A few years ago, not many in fact, our educational institutions, our col- 
leges more particularly, rather confined themselves or rather specialized in 
cultural studies. They might be compared to the hot-house conservatory of 
the wealthy man, where he played with his prize specimen. Of late years, 
however, there has been a tendency, a very strong tendency, to particularize 
in rather practical studies, and we have watched with much interest the 
growth of such particular subjects as engineering and agriculture. 

This development has brought the university very much closer to the 
people, as is clearly evidenced by the large growth in attendance. We 
thought not many years ago that a thousand students was a large enrollment. 
Today we find six thousand not uncommon. 

The development has not been confinfied to privately endowed institu- 
tions. State universities supported by tax upon the citizens of the state have 
kept march with the progress of the other universities, indicating a rather 
warm feeling on the part of the people at large toward our higher educational 
institutions. The recent legislative program in our own state, in which, 
added to the large appropriations for operation, they included a program pro- 
viding for from ten to fifteen millions of dollars to be spent upon engineering 
schools in the University of Illinois, — it seems rather a big proposition, or 
would have been a few years ago. Today we accept it as rather common. 

Some five years ago, or thereabouts, it was my privilege to attend the 
first annual meeting of the Chamber of Commerce of the United States. 
You will remember that that organization was formed to centralize or rather 
co-ordinate the efforts of the business organizations of the country. Presi- 
dent Taft approved the program. Mr. Wheeler of our own city was its first 
president. And one of the first questions considered by that .body was a 
Federal Trade Commission. 

We had been very busy up to that time busting trusts. It had become 

187 

















C. R. Van Hise 





The Importance of the Human Factor in Industrial Preparedness 



a favored occupation. We found that there was something wrong with the 
method pursued and we began to think that with a little careful study, a new 
method of dealing with large business would be discovered and so the first 
thought of this new commercial body was to consider what might be done 
to regulate trade rather than to destroy it. 

I was interested at that meeting in hearing Dr. Van Hise express some 
viewpoints which were new to many of us, but which showed that he had 
been considering the subject very carefully, and on the way home on the 
train I remember I invited him to speak in Chicago and we had the privilege 
of hearing him on that subject shortly after. 

The University of Wisconsin is almost as close to us as our own state 
university. We hear of it and think of it almost as much. Many of our 
students go there. We do value very highly in this community the president 
of that institution. He is a man who has studied through many years sub- 
jects from the standpoint of the university professor, but he has been broad- 
visioned and has realized that there are other angles than those which come 
to the university professor alone, and so he has mixed with business men and 
has studied business institutions and brings to all of us a wealth of knowl- 
edge which is difficult to obtain ordinarily. 

It is a privilege, and the Western Efficiency Society may indeed be con- 
gratulated on having as a speaker on "Governmental Control of Industries 
in War Times," Dr. Van Hise of the University of Wisconsin. (Applause.) 

GOVERNMENTAL CONTROL OF INDUSTRIES. 
Address by Charles R. Van Hise, Ph. D. 

Ladies and Gentlemen of the Western Efficiency Society: It is a very 
great pleasure indeed to accept the invitation of your secretary to visit this 
society and speak upon this subject. I have been interested in the question 
of efficiency for a great many years, especially in relation to my studies upon 
coal and iron, and their conservation. I have had a lot of pleasure with the 
late Mr. Taylor of Philadelphia, visiting some of the establishments in Phila- 
delphia, where his ideas were first introduced. 

It is true you have not followed those ideas altogether, they have varied 
and varied and developed greatly, but his work was pioneer work along the 
line of organization, as well as pioneer work along the essential discoveries 
which were necessary for the highest efficiency. 

In my interest in the metals, I have visited the various establishments so 
far as I could over the country, considering this problem of efficiency in rela- 
tion to the use and production of metals. 

But this evening, I do not know that those have been the problems you 
have been especially considering, but those are the problems in which you are 
experts and problems in which I am a novice, and therefore, in order to avoid 
the danger of making mistakes and talking about subjects on which you have 
a great deal more knowledge than I have, I have picked out one on which, 
I trust, you have no more knowledge than I have. 

We are all familiar with the story of mounting prices. For the most 

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Western Efficiency Society Conference 



essential commodities,— food, clothing, iron, steel, coal— there has been a 
steady movement of enhancing prices. This movement began some years 
ago and has gone on for some fifteen or twenty years at a very moderate rate, 
the cumulative effect, however, being great. 

However, about two years ago, after the great European war began, the 
upward movement went on with accelerated speed, and at the end, or from 
about two years to one year ago, the enhancement of price did not average 
that of previous years, two or three or five per cent, but varied from ten to 
twenty-five per cent ; and this last year the upward movement has gone sky- 
ward at a speed that never before has been approached. 

The new conditions have brought great hardships upon the laboring 
classes and those of moderate means, especially those with fixed salaries. 
For while wages have advanced among the working men and while salaries 
have somewhat advanced, they have not kept pace with the rising prices. So 
while the workman perhaps now gets a dollar and a half where he used to 
get only a dollar, in that ratio he is worse off, so far as furnishing the essen- 
tial commodities are concerned to his family, than he was two years ago. 

In this country we have depended upon the so-called law of supply and 
demand to control prices. This has been something of a fetish to us. We 
found it in all our political economists, that the law of supply and demand 
would control, and if the demand went up somewhat, the supply would 
increase and the prices would be kept at moderate amounts. 

But, evidently, there has been some trouble with that theory in the last 
year or two. It is true in normal years the supply and demand are controll- 
ing factors, providing they are free, but when the demand is in excess of the 
supply for every essential article, then the control proves to be wholly 
inadequate. When we have essential demand exceeding the supply for one 
article where there is a substitute, we can substitute, and so control somewhat 
the prices. But when the demand exceeds the supply everywhere for all 
essential articles, the system breaks down and the prices go skyward. 

I may give some illustrations of what has happened to show how the 
extent of this extraordinary enhancement of prices has taken place. 

On May 1st, bituminous coal (Pittsburgh) at Chicago was worth six 
dollars and a half. A year ago it was $3.50. Pocahontos coal in New York, 
from a statement made in Commerce the other day, has advanced from $3.65 
to $8.25 in ten months. A recent contract for washed Illinois coal at the 
mines was made at $2.75. For that very same quality of washed coal $1.25 
was the price a year ago. 

At the present time, for screen coal which was contracted for by the Uni- 
versity of Wisconsin a year ago at the mines for seventy-five cents for large 
contracts, sufficient to supply that institution amounting to many thousands 
of tons, will be taken now at $3.00 per ton. 

I noticed in the Chicago papers just the other day that the cost of the 
coal for your schools in your city will be increased under the contracts actu- 
ally made by more than one hundred per cent, the amount paid last year 
being about $400,000.00, while this coming year it will be $1,000,000.00. 

An interesting incident occurred today which came to my knowledge. 
An operator of Illinois coal proposed to a large consumer that he would give 

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The Im portance of the Human Factor in Industrial Preparedness 

him a contract for $3.50 to supply him for the winter, the coming year. The 
buyer said that that was too much and that he had an offer for similar coal 
at $3.00. The operator said he would meet that price, and when he was told 
that the buyer would not pay that price of $3.00, he offered to furnish the 
coal for $2.75. 

I mention this incident, because it foreshadows something I shall say 
later. It foreshadows a situation which now exists and it indicates the fear 
operators have that these prices are grossly excessive. Already there have 
been investigations of the coal prices charged by the bituminous coal pro- 
ducers and the anthracite producers by the Federal Trade Commission. 
Already there is pending in Congress a measure which may take this matter 
in hand. And therefore operators are now, wherever they can find an unwary 
customer who will buy ahead, so long as this frenzied buying exists at these 
exorbitant prices, placing contracts at current cash figures or at very consid- 
erable reductions from such figures. 

The law of supply and demand has at least a wide variation today in the 
matter of coal, in the prices that are charged. 

Pig iron, Philadelphia, on May 1, 1915, was $14.25; in 1916, $20.50; in 
1917, $42.50. 

Steel billets at Pittsburgh in those same days $20 in 1915, $45 in 1916 
and $80 in May, 1917. 

Steel beams advanced during the same years from $23 to $50 and to $80. 

Steel rails advanced from $28 to $33 and now are $38. 

Why should there not be as great an advance in proportion on steel 
rails as on steel beams and on steel billets? Can any one give a reason? 
Except that the railroads are very large buyers of that standard product, 
while the other buyers are more scattered and heterogeneous and cannot so 
unite, and therefore larger prices are extorted. 

And now to the grains. We find that we had a maximum price of 
$3.25 on May 11, 1917, while it was $1.16 a year ago that day. Similarly 
corn advanced on the same days from seventy-five cents to $1.59. Potatoes 
are now $9 a barrel as compared with $3.50 in 1916 and $1.25 in 1915. 

But the most astonishing of all are white turnips and onions. White 
turnips were $5 a barrel May 1st; a year ago one-tenth that, or fifty cents. 
Red onions were $6 a bag on May 1st and fifty cents a year ago. 

I noticed this morning in the papers that eighty-eight producers and 
individuals concerned in the ownership of red onions and white onions and 
other kinds of onions had been indicted by the Federal government for con- 
spiracy in restraint of trade. (Applause.) It was alleged that that combine 
had secured three-fourths of the crop of onions, that they had held them in 
storage and they had pushed the prices up and up and up, until one bag of 
onions gave them prices several times the amount of the cost; and there are 
ample supplies of onions in the market to supply all the reasonable needs of 
the populace for that vegetable,— which has its merits and demerits. (Laugh- 
ter.) 

Why, gentlemen, the enhancing prices have extended beyond the exterior 
of this world. Crude brimstone is now selling for $45 a ton, whereas in 
1916 it was $28.50 and in 1915 $22. Even his Satanic Majesty must econo- 

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mize. So far as I can learn this is the only advantage that has come to 
humanity and even this applies presumably only to a part which has left the 
world. (Laughter.) 

While these vastly enhancing prices rest, it is true, upon the basic fact 
the supply exceeds the demand, there have been other aggravating causes, as 
has already been indicated. 

The first of these, and an innocent cause, is the frenzy of buying With 
the prices going up day by day the canny housewife concludes that she will 
put m a year s supply ; and I heard of one Yankee up in Vermont who was so 
afraid of the future and thought the war would last a long time that he 
bought a four years' supply of staple products. Naturally, if instead of buv- 
ing at the ordinary way or at the ordinary rate it is demanded at once to 
nave supplies far exceeding present needs, this very greatly aggravates the 
situation, and there is no question that this has gone on all over the country 
by many inconsiderate buyers, by many people who have not thought the 
thing through, by many people who wish to affect the immediate future 

It is entirely natural, for instance, for 'an educational institution that 
must have coal m order to run, to buy the amount that is necessary to carry 
it through the year at this time and have it piled up at the yards, so that the 
institution will not be closed during the coming winter. 

Apparently, that is the theory which has obtained here in Chicago. 
Your board of education, according to your papers— this only a newspaper 
statement I am citing— according to your papers the board of education has 
actually purchased this coal in accordance with those figures which I have 
given you. I am glad to say that the University of Wisconsin will refuse to 
buy at present prices or to make any contract at present prices, but only 
make arrangements to have deliveries through the months on the basis of 
the market prices as they then exist. 

This fear of shortage has, of course, for all of these products very greatly 
advanced these prices. It is even reported— I don't know whether correctly 
or not— that on behalf of the British government and the French govern- 
ment there have been vast purchases of wheat for future deliveries, in order 
that the Allies may have a sufficient amount of that essential cereal. 

But on the top of these other things, this enhancement of price, this 
excessive demand has greatly enhanced the difficulty. 

Then there has been 'a still further cause, and that is speculative holding, 
buying of future supplies to hold for speculative purposes. I believe you 
have a somewhat noted character, if that is the proper word in Chicago, I 
have forgotten his name, who is long on eggs. He bought many millions of 
dozens of eggs, I am told, and put them in warehouses, — and he has eggs yet 
for sale — and so the price was forced up abnormally in consequence of his 
purchases, with other purchasing. This practice of accumulating great sup- 
plies which are not necessary either for himself or for others with whom 
he is associated, used to be called forestalling. Forestalling in law was in 
the olden days prohibited, with heavy penalties. 

Also there has been co-operation of the producers to control the market. 
This producer and that producer having the same commodities, have united 
in regard to their prices. Of this there can be no doubt. Of course, you 

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The Importance of the Human Factor in Industrial Preparedness 

cannot find a written contract in their safes telling ^about their union and that 
they agreed to charge just the same prices on just the same day for just the 
same article, but we know it has occurred everywhere, from the country 
crossroads to the great centers. Does it make a particle of difference here in 
Chicago from which of the coal dealers you buy anthracite? Does it make a 
particle of difference when you need the antidote for brimstone, ice? The 
price is just the same, — by an act of Providence, I suppose. (Laughter.) 

Everywhere there is combination and co-operation to hold the prices up 
and to control the market. Therefore we have these four causes : Excess of 
demand, frenzied buying, forestalling and manipulation to control the mar- 
ket, all working together to result in this enhancement of prices. 

It is not necessary that the demand be double the supply. It is not 
necessary that the demand be more than ten or fifteen per cent above the 
supply, with all of these factors working together until the prices doubled or 
trebled ; and that is just what has happened during the past two years. 

This tendency, once started, is very difficult to control. It is cumula- 
tive. The railroads must pay more for coal. Therefore, the prices of com- 
modities are greater. The employees must pay more for food and clothing. 
They, therefore, must have higher pay. The higher expenses of the rail- 
roads must result in their requests for increased rates, and that enhances the 
prices of all the commodities they carry. Having once completed the circle, 
then the cycle is gone through a second time, and prices have gone to the 
clouds, like a spiral ascending to the sky. 

Under these circumstances, naturally the profits have been enormous. In 
the case of the food production such as wheat and corn and products of that 
kind, the profits have been distributed between the farmers, between the 
middle men and between the manipulators. The aggregate is enormous but 
it has not been at one place. 

But this is not true for all of the commodities. In the case of those 
industries like iron and steel, the great increase in price has gone mainly to 
the producer. It is true that their supplies have cost somewhat more, be- 
cause no industry is so complete that it does not have to buy something; also 
it has been necessary to pay more for wages. But, after all, the increased 
cost due to higher wages and to the additional cost on commodities, has been 
trivial as compared with the winnings of the great producers. 

United States Steel, common, was selling at 85 one year ago. It has 
now reached 134, an advance substantially of 50 per cent, an increase in the 
value of that stock by $250,000,000. This is in addition to paying interest on 
the bonds, in addition to paying 7 per cent interest on the preferred stock, in 
addition to paying 5 per cent interest on the common stock, and the last quar- 
ter, 3 per cent for the quarter, in addition to accumulating handsome reserves 
of millions of dollars. 

You may say that this marked increase is not justified. But if you look 
at the books, the returns of the United States Steel Corporation and examine 
what has been done during the past year, you will find as a matter of fact that 
the substance that is in the business is now substantially $250,000,000 more 
than it was a year ago. Therefore, the rising prices have gone very closely 
with the actual accumulation, the actual surplus profits of this gigantic cor- 

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Western Efficiency Society Conference 



poration. It is a safe statement to make that the excess profis of the great 
steel corporations during- the past year have been $500,000,000. 

I shall read now from the Wall Street Journal of a few weeks ago: "The 
proposal of Armour & Company to declare a stock dividend of 400 per cent, 
thus increasing the capital to $100,000,000, followed so closely the declara- 
tion of Swift & Company of a $25,000,000 cash dividend, to be followed by 
the issue of new stock to the same amount at par, thus increasing this com- 
pany's capital to the hundred million mark, calls attention to the volume of 
business done by the packing houses of Chicago." 

It calls the consumers' attention to the fact that not all of this enhanced 
price for pork and mutton and steak and other meats has been due altogether 
to the shortage of supply, as has been so ably held by some of the leading 
packers. 

For it is to be noticed that this issue of seventy-five million dollars of 
new stock was not an issue of water, but was based upon substance that had 
accumulated in the business, and the same is true of this fifty-million-dollar 
surplus of Swift & Company. 

Does any one doubt that the prices in 1915 for the United States Steel 
Corporation, for Swift, for Armour, for Wilson and for these other great 
corporations were not fair and reasonable? Their reports show that they 
were paying interest on their bonds, they were paying their preferred stock 
rates at the standard amount and they were giving handsome normal divi- 
dends upon their common stock. Therefore, these vast accumulated excess 
profits are surpluses which are taken from the public, extorted from the pub- 
lic under these extraordinary conditions which now exist. (Applause.) 

As to some of the more important coal producers of Illinois, I have been 
informed that the excess profits at present prices are from one to two dollars 
a ton as compared to what they were a year ago, or the excess profits are 
now more in most cases than the price that was received for the coal at the 
mine a year ago. 

I have not made any attempt to find out about the profits of the muni- 
tion makers, those who make powder and shells and guns and other muni- 
tions. They are way, way beyond those that have already been given, in 
proportion to the investment. 

Copper is sold to the United States government at about one-half the 
amount that it is sold to the ordinary consumer. The price of copper at the 
present time is thirty-two cents a pound ; and this is compared with about 
sixteen cents two years ago. The copper producers are giving the govern- 
ment copper at a price which was the average before the enhanced prices of 
the war, and even in those times I haven't heard but what the Anaconda, the 
Utah Copper, and the Calumet and Hecla and other great copper mines were 
not making fair profits. 

The steel producers are selling to the government at prices far below 
what they are selling to other consumers. And the same is true for sub- 
stantially all of the material which is going into the naval lines and con- 
struction work in which the government is interested, battleships, and all 
the lines of necessary war supplies. 

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The Importance of the Human Factor in Industrial Preparedness 



I agree that the government should have a fair price, but what is the 
government but an organism which represents the people. If extortion is 
practiced on the government, it is passed on to you and to me in taxes, which 
we will have to pay at once in the future through issuance of bonds. Why 
should we individually or in groups be subjected to extortion that the gov- 
ernment won't stand? Because while these companies say it is because they 
are patriotic and they want to give the government good prices so they shall 
not make any war profits, — there is almost a mingling of motives — but I 
suspect with that beautiful patriotic sentiment there is the fear in the back 
of their heads that if they do not give the government fair prices something 
will happen which will possibly prevent their getting unfair prices from 
somebody else besides the government, and that would be very expensive, 
and therefore it is much wiser to be patriotic and give the government fair 
prices. (Applause). 

But it is' unnecessary to dwell upon the facts. I have brought them 
together so that perhaps they may have some cumulative force. You were 
all aware of them before I began to speak. The question which I should 
like to consider, therefore, is the remedy, and in this matter I shall not claim 
anything especially new, because I shall advocate substantially the remedy 
that has been proposed by the government; that is, that there shall be an 
administrative body to control both prices and distribution. 

We in this country are very conservative. We are not convinced by 
theoretical knowledge. We are not convinced by anything but the facts 
driven in, upon us. Political economists have been telling all of you men 
who have been to college or to high school that demand, supply and com- 
petition would adequately control prices to protect the public. 

Well, we all know that it won't. We all know that some other remedy 
than the law of supply and demand and competition must be introduced 
to halt this movement, because there is no sign of its cessation, — except that 
there is being threatened government legislation, which in some measure 
has made timid the manipulators and those who were promoting and co- 
operating to control the market. 

The remedies are comprised in two broad measures, but are summarized 
morefully in the statement of President Wilson. Broadly, the things that 
are necessary are the authority in the hands of an administrative body to 
control maximum and minimum prices for all essential commodities in which 
the market may be controlled by co-operation or may be controlled by manip- 
ulation, or where the demand exceeds the supply, and to control distribu- 
tion; for, as you will see, it is just as necessary to control distribution as 
it is to control prices. 

In Great Britain, France, Austria and Russia exactly the same phenome- 
non in regard to prices began which we have seen in this country, only that 
they, in the midst of war, were more prompt than we were to undertake 
the necessary steps to regulate the prices and to distribute commodities, 
with the consequence that for many of the essentials in these United States, 
where the supplies of all these essential articles are far beyond what they are 
in the European countries in proportion to the demand, the prices are much 
higher than they are abroad. 

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Western Efficiency Society Conference 



Already I have said, there has been a halt in this skyward movement, 
but that halt did not begin until this proposal was made. The very fact 
that it is proposed that some administrative authority shall have power to 
hold prices to a reasonable amount has been a deterrent which has prevented 
these increases partly because it has slackened somewhat the frenzy of 
buying, but more largely because manipulators fearing that if they forced 
prices up and the government intervened would have commodities on their 
hands which they could not dispose of at those prices has tended to prevent 
manipulation in stock speculation in the future. 

We know on the exchange in Chicago it was necessary actually to sus- 
pend dealing in futures for wheat after it reached this maximum price of 
$3.25. True it was announced that this was a voluntary action on the part 
of those in the stock exchange, but also it was said that the managers of the 
stock exchange were in close communication with the government author- 
ities at Washington. 

There is another very important reason why it is necessary to fix max- 
imum and minimum prices if this war is to long continue. It is necessary 
to be assured that there shall be a sufficient product of essential commodi- 
ties. It has been found advantageous in Great Britain and in the other 
countries to insure the farmers certain minimum prices concerning commodi- 
ties which are of somewhat perishable nature. 

For instance, it would have been perfectly justified on the part of the 
government this year had it had the figures, had it had the administrative 
body, had it had the necessary data to have said to the farmers of the coun- 
try, "You shall have such a minimum price for your potatoes at such a mar- 
ket, with corresponding prices, of course depending on freight, in other mar- 
kets for wheat and other commodities." Had that been, it would have re- 
sulted in even a larger amount of commodities for the market. (Applause.) 
This has been done in England, to the very great advantage of that nation. 

However, before it is possible to wisely fix prices, to wisely guarantee 
future prices at a minimum, it is necessary to know the amount of the com- 
modity available, to know the probable amount which will be produced, and 
hence it is necessary to have a careful survey of all important products, not 
only the existing supply, but the potential supply and probable demands, in 
order that the situation may be gauged. This will require a very close study 
by the department of agriculture of all these commodities. 

To be sure, we do have something of this sort in the way of estimates 
by the department of agriculture, but only of the roughest kind. We have 
nothing anywhere amounting to an accurate survey of the essential resources, 
in sight, potential, and those with relation to probable demands. 

Furthermore, I have said that it is necessary to have these adminis- 
trative bodies control distribution. There must be preferential distribution. 
The railroads must have enough coal to run their locomotives. All those in- 
dustries which are very necessary for ship-building to carry on the war must 
have the essential supplies of coal. Coal must be furnished sufficient to heat 
our homes, but there are other industries which are not so essential. There 
are industries which manufacture luxuries or, if not luxuries, other articles 
which can be spared or the construction of which can be deferred. 

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The Importance of the Human Factor in Industrial Preparedness 

These facts have been recognized by England, and there is one board 
composed of able men giving their entire time to this question of preferences. 
No man in England can get an order filled by any manufacturer until it has 
been approved by this board. 

All orders are divided into three classes : A, B, and C. A, those funda- 
mental essential necessities to prosecute the war and feed the people; B, 
those things which are somewhat related to these essentials, but must wait; 
and C, things that are convenient and nice and desirable, but need not neces- 
sarily be done. And until all the needs or A and B are met, those things 
which fall in class C cannot be touched by any manufacturer. 

This sounds to us like an extraordinary proposal but it was driven upon 
England by the grim logic of events. If we in America are to do our utmost 
to carry this war to a successful conclusion, we shall have to put that first, 
we shall have to do every essential thing in the way of control to produce 
those commodities which are fundamental to ourselves and to our allies. 

One of the remedies which has been applied very successfully in the 
partial lessening of the difficulty is a campaign of education, which is now 
being carried on by the State Council of Defense and the National Council 
of Defense and other bodies in regard to buying, urging upon everybody to 
buy precisely as they have done before. Much good has been done in that 
way and much more good can be done by continuing that process of educa- 
tion. 

Also another remedy for these enormous profits will be the tax, the sur- 
plus tax upon excess profits. In England these surplus profits were first 
taxed in 1915 at 50 per cent. They were raised to 60 per cent in 1916, and 
now are 80 per cent. The excess profits in England yielded her $700,000,000 
last year to carry on the war, or more than one-half of what the Senate is 
seeking to raise by its entire revenue bill beyond the ordinary revenues. 

The House of Representatives proposed that in this country there should 
be a 16 per cent of the excess profits tax, and it was anticipated that in this 
country it would yield $200,000,000, but the Senate, I note by the papers 
today, has proposed a substitute that this shall be only on above eight per 
cent on the average of the last five years. These tremendous profits of the 
past year and a half are to go in to give you a base before the excess profits 
begin. It is obvious that that $200,000,000 will be vastly reduced under that 
basis. 

I think it is always true that the Senate is — to use the exactly fitting 
word — more sensitive to forces from big business than is the House, and we 
hear at once of a lowering of these taxes much lower than the House has 
proposed, but the bill of the House, if compared with the taxes which are 
being made in France, England, Germany, Austria or Russia, are very mod- 
erate, very moderate indeed. And in excess profits, — while I don't say in 
regard to all these figures — but I say if all these enormous profits such as 
have been enjoyed by the steel corporation, by Swift & Company, by Armour 
& Company, and by the great munition factories and by many other indus- 
tries, if they are allowed to continue, 16 per cent upon the excess profits is 
absurdly low. 

However, these excess profits may be reduced by these other measures 

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Western Efficiency Society Conference 



which have been advocated. If, of course, there is created an administrative 
commission to enforce reasonable prices, the excess profits will be enormously 
reduced, and it might be that upon those then 16 per cent would be sufficient. 
If there is not regulation to reduce the prices to reasonable amounts, then 
16 per cent is far too low. 

Another fundamental reason why it is necessary that an administrative 
commission shall be created to stop this enhancement of prices, and not only 
to stop it but begin the movement of recession to normal prices, is to pre- 
vent a gigantic panic in the future. Sometime this war must end — we hope 
it may be soon — but the dreadful catastrophe which is now upon the world 
may continue for a long time, and finally the time will come when with 
this enormous expansion of building power everywhere, — the time will come 
when the supply will exceed the demand, and these prices in the sky will 
fall to the earth ; and then there will be a gigantic panic, perhaps one of the 
greatest that has ever befallen this country. 

That time can only be avoided by now gradually, through public pressure 
by some administrative way, reducing these prices to something nearer nor- 
mal and reasonable amounts. 

You may say that I am assigning a task that cannot be performed by 
any living group of men. If you mean by that any living group or groups 
within the bureaucracies of Washington, I agree with you. (Applause.) Oh, 
I know those bureaucracies. I once was a member of one of them for a 
few years and also in other capacities I have dealt with them. Secretaries 
of war, secretaries of the navy, and secretaries in other fields, unless they 
are dynamos of energy and men of broad power and with wills inflexible, 
are almost useless against these bureaucratic chiefs, for they have been long 
bureau chiefs and when anything is.proposed they have bushels of reasons, 
not at the price of onions, but much deeper, to give why a thing should not 
be done. And the secretary is not able to meet them, and the bureau chief 
prevails by delay, by passing it from one place to another, or, if the order 
still persists, to get other bureau chiefs to come to his aid. The bureaus 
spend great sums of money and they are able to give favors to Congress, and 
when it comes to a conflict between a bureau chief and the staff of the gen- 
eral army, a staff which has money to spend, the bureau chief beats the 
staff, every time. 

There is but one way in which this great task can be performed, and 
that way must be the way shown by the experience of England and France 
and Germany. That is to bring in your highest class business men, your 
highest class economists, your highest class lawyers and the ablest men of 
the country and put them on these boards to do this great administrative 
work. (Applause.) 

The bureaus of England were just as fossilized as were ours at the 
beginning of the war, and before the crust of those bureaus was broken 
through, England paid heavily for it, heavily in money and heavily in men. 

I trust it will not be necessary for us to have to go through the experience 
which England went through in this respect, but from the outset when this 
bill is passed, there must be placed at the head of the bureau to control 
prices and to do this regulatory work men of great intellectual powers and 

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The Importance of the Human Factor in Industrial Preparedness 



broad experience, who are accustomed to handle these great questions. You 
cannot expect the $50,000 job or the $100,000 job, such as these men are, 
to be performed by clerks at $2,000 or $3,000 a year. And I am glad to 
know, — I am delighted to note that the President has seen this at the outset 
and proposed to put Mr. Hoover, who has had this great administrative 
experience in Belgium and elsewhere, at the head of this work. (Applause.) 

It' is fortunate that we are looking at the right direction from the outset. 
Also when our Council of Defense was built up, outside of the heads who 
were ex-officio members, some of the ablest business men of the country 
were named, and the situation is that we have escaped ship-wreck almost at 
the outset, and that is due, even more largely than perhaps some of you 
know, to this Council of Defense. 

And yet the other day the Senate put in its appropriation bill, — I think 
it was the war appropriation bill — that in making this appropriation nothing 
should be construed to in any way extend the powers of the Council of 
Defense. The bureau chiefs have gotten in their work. Jealous of any 
outside authority, jealous as they are impudent and futile and reactionary, 
they will do everything possible to prevent these mighty problems being- 
handled in a satisfactory fashion. (Applause.) 

In summary, then, my remedy for this great problem which now con- 
fronts us by the enhancing prices is to have a commission or commissions 
with powers to fix maximum or minimum prices and with powers to control 
distribution, and in addition to this, place heavy excess profit taxes to carry 
on the war. 

I trust that at the earliest possible moment Congress will enact this 
absolutely essential legislation, and that there will be placed at its head Mr. 
Hoover. Already he has begun to build up his force of men in a preliminary 
way. I am informed, and I have great confidence that we shall succeed, — I 
hope this year, and if not, the next, if the war goes on — in handling these 
problems wisely and rationally, as have England and France and other coun- 
tries engaged in the war. 

If I have not talked too long I should like to take up, however very 
briefly, some suggestions in regard to the future. 

When five years ago I gave an address upon concentration of control 
and advocated the principles of concentration of industry with regulation 
and proposed there should be a federal trade commission to have authority 
to control co-operation, as has been alluded to by the Chairman of the even- 
ing, it was regarded as wild Wisconsin radicalism, and the Republican and 
Democratic parties in the campaign of four years ago last Autumn would 
have absolutely nothing to do with the proposal ; they both denounced it as 
socialistic, and they applied as many other odious terms to the proposal as 
they could think of. 

" And yet, when Congress convened, and the problems which confronted 
them were fully considered, and it was seen how futile had been the attempts 
to control industry by the Sherman Act, a trade commission was created ; not 
with sufficient powers, but with large powers, and that trade commission, 
which the business men feared, is now to be found to be of great advantage 
to them. And these proposals of five years ago are mild and trivial com- 

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The Importance of the Human Factor in Industrial Prepa redness 

pared with the proposals which now Congress is substantially certain to 
enact into law under the stress of this great war, so rapidly do times move. 

The Sherman law forbids any agreement among producers or anyone to 
agree upon prices, and yet the Interstate Commerce Commission says that 
the railroads must pay the same price for the same service everywhere, 
whichever the railroad. 

In consequence of that, everybody has forgotten that all the railroads 
in the United States are violating the Sherman Act every day. They could 
be prosecuted successfully for violation of those acts just as certainly as the 
men who are selling onions ; but because through the Interstate Commerce 
Commission the public is protected, we have forgotten, absolutely forgotten, 
that the railroads are amenable to the Sherman Act. 

In the same way, when there is created an administrative commission 
to control prices, fix minimum and maximum prices and to protect the public 
in these matters of production and distribution and costs, we shall again 
forget that the Sherman Act is applicable, because it is an advantage. It 
would be an advantage for those onion men to have united to get together 
the product, to gauge the market, to distribute it wisely, and so produce their 
commodity with concentration and co-operation, if only a fair price had 
been charged. And when we have governmental authority to compel fair 
prices we will have co-operation and concentration in all lines of industry, 
not hidden under the table or in the dark, but in the open, just as have the 
railroads, and everybody will approve and futile prosecutions under the 
Sherman Act will cease. So it may be a possibility when the time comes 
to get the Sherman Act amended so as to permit co-operation which is not 
detrimental to the public welfare, a proposal which I made to the committees 
of Congress at the request of the Chamber of Commerce at the time to which 
Mr. O'Leary alluded. 

Why, already, we see a situation forecasted. Mr. Peabody of a great 
coal dealing firm here in Chicago at the request of the Interstate Commerce 
Commission has brought the operators together, and they are going to agree 
on a plan approved by the Interstate Commerce Commission for a diversion 
of the coal to the lakes, to a division of the materials among the mines, to a 
distribution of territory, to all these things for which they could be prose- 
cuted under the Sherman Act. 
knew that it was requesting Mr. Peabody and other coal operators to violate 

When the Interstate Commerce Commission did that the Commission 
knew that it was requesting Mr. Peabody and other coal operators to violate 
the Sherman law by a division of territory, by a division of production, by 
agreement of selling agencies, by co-operation, by distribution. Undoubtedly, 
the advice, if carried out, will violate the Sherman Act. But will they 
be prosecuted? Of course not. For the public will be benefited. It is a 
public enterprise. 

It but illustrates that these problems which have been handled unra- 
tionally will be handled rationally when the new time comes, when we shall 
have the business men co-operating, when such co-operation is not detri- 
mental to the public welfare and we have commissions to control that co- 
operation. 

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There are enormous advantages that would come of these economies, 
almost beyond calculation, a saving in waste, a great advantage, by saving, 
our coal and saving our timber, from every point of view. The coal dealers 
in Illinois for a long time have wanted the coal miners to agree upon division 
of territory and a pooling of the product among themselves proportionately 
and having common selling agencies in Chicago, but they could not do it 
under the Sherman Act. And now we have coming into this the Govern- 
ment, not buying for the government alone, but Ave are going to have the 
Government buying all these commodities which are to be bought by the 
billions of dollars which we are to loan the allies, for distribution in Russia, 
England, France, Belgium and Italy. We shall have co-operation not simply 
of the class of the cartels of the small group, but we shall have national 
co-operation, national buying; we shall have international co-operation and 
we shall have international buying. That is imminent in this country. It 
already exists in Europe. 

And when the war is ended, do you suppose we shall go back to the 
old cut-throat competition methods of prices too high one day and too low 
another, of feast or of famine, or shall we have a rational system of pro- 
duction and distribution under governmental regulation promoting co-opera- 
tion? 

When the war ends we will have two great economic groups, the central 
powers and the group of countries allied with them, and the allies, the 
United States and the most of America. For years, for many years, they 
will be suspicious of one another, they will be hostile to one another. 

Why, only the other day we found out the civil war had ended because 
it was proposed that the northern Presbyterian church and the southern 
Presbyterian church were again to unite, — more than sixty years ago. The 
animosities of this great war will last for generations, unhappily will last 
for generations. 

Under these circumstances, neither one group of a country nor the 
other can go back to individualism in buying and selling; it is impossible. 
Either one that did it would be beaten by the other; and so we shall have 
gigantic co-operation. I knew it was coming, — as an economic necessity, 
I have known it for years. But I never believed I would see it in my life 
time. Th war, however, has forced events at a speed which nobody had 
predicted. 

You may say this is socialism, but whether it is socialism or not, it is 
here. And we shall not return to the old conditions. However, I wish to 
call your attention to the fact that in controlling prices, in regulating dis- 
tribution, it is not proposed that the nation shall undertake production on a 
large scale. Its production will be confined to its own immediate needs of 
particular articles like battle ships and munitions, possibly railroads in Alaska, 
and things like that. There will be the great possibilities for individualism, 
for capacity and knowledge, for all of the advantages which have existed in 
the past, in the future. 

If one great corporation runs its business more efficiently than another 
— and that is the special subject which you have been considering — its profits 
will be larger. Therefore, there will be demands for men who know the 



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The Importance of the Human Factor in Industrial Preparedness 



methods of efficiency, men who know resources, men who know markets, 
men who can gauge the situation, men who will handle their productive work 
with the same initiative and capacity and ability that has been required in 
the past. 

It will be indeed a misfortune if we were to sink to the dead level of 
mediocrity in which there would not be the strongest incentive to individual 
capacity and advance as now exist. But large and larger rewards will be 
just as certain in the future as they have been in the past in all legitimate 
lines. Only we shall promote concentration where concentration saves waste. 
Where it conserves our resources, where it prevents over-production. We 
shall have co-operation in distribution and we shall gauge our markets so 
we shall produce enough and no more, and we shall have the public pro- 
tected through commissions, state and national, so that we shall not- have 
the country mulcted of hundreds of millions of dollars in many industries 
as has been done this past year. 

It seems to me that in the future we shall be on a higher plane eco- 
nomically than we are now. We shall adopt the principles that men in 
business may co-operate as they may in religion and as they may in educa- 
tion, without being regarded as thieves or robbers. We shall say that co- 
operation is wrong only when conducted to the detriment of public welfare. 
So far as it conserves our resources, so far as it makes industry more efficient, 
it will make deeper and lower prices and will be of advantage to the public, 
and, therefore, so far as I am personally concerned, I do not look upon 
these tendencies, these inevitable movements, with alarm. They are, it is 
true, legislated only for the war, but, while some of them may be abandoned 
after the war, we shall never go back to the old situation when we had 
blind faith in regulation through the law of supply and demand and cut- 
throat competition. We shall be on a newer, higher economic plane, when 
men of business, instead of being enemies, may co-operate for their mutual 
benefit. 

I thank you. (Prolonged applause.) 

CHAIRMAN O'LEARY: I think Dr. Von Hise has rather made us 
willing to accept what we^must accept, governmental control of industry in 
war times, but I like to think more of his last remarks, I like to think that 
that control will be exercised through co-operation, rather than by other 
means. 

A few days ago Chicago had the pleasure of entertaining the labor 
members of the British Commission visiting the United States. There were 
on that Commission — it was called the Labor members — two members of 
trade unions, one a professor from Oxford University and one a capitalist. 
I was very much interested in the comments of the professor from Oxford 
in speaking of the very laws that Dr. Van Hise has told you are being con- 
sidered in Washington, the laws regarding maximum and minimum prices, 
the laws controlling industries through the boards provided for that pur- 
pose. But I was most interested in the information that while those laws 
may stand, while the power was there, that it was not being used because 
it was not necessary. Co-operation was effecting what the law gave power 
to enforce. 

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And I am hopeful that that is what will occur in this country. I hope 
we won't be so impressed with the needs of control that we'll ask that the 
bureaucrats shall have control of industries, for that would be just as unfor- 
tunate as the present administration of bureau affairs is. But I don't gather 
that we are to take that thought away with us. I gather that Dr. Van Hise 
leaves with us the message that with the co-operation of government and 
business the sins and evils and iniquities of the past will not exist. (Ap- 
plause.) 

PRESIDENT KESSLER: Before we bring the conference to a close, 
we want to hear again from Mr. Emerson, Mr. Knoeppel, Mr. Gilbreth and 
one or two others. In order to balance the meeting we are going to ask 
each speaker to come within a five-minute mark. 

The first speaker needs no introduction. Mr. Emerson. (Applause.) 

MR. EMERSON : Mr. Chairman, Ladies and Gentlemen of the Western 
Efficiency Society and Guests : I remember the story of an Indian in Florida 
who was asked to make a bow and arrow. He said that any stick is o- od 
enough for the bow, but it takes a very good stick to make the arrow. Any 
organization is good enough for the purpose in times of peace. It requires 
an extraordinarily good organization to stand the stress of a great catas- 
trophe. Any tug can sail on a mill pond in the summer time. It takes a 
staunch boat to breast the ice of the Antartic ocean or the typhoons of 
the tropics. 

I have been most interested in the study of organization by taking 
lessons from nature. Animals are all organized on the same general plan. 
For the last five hundred million years they have been so organized. And 
in all the millions of species and all the billions of individuals they are just 
as much prepared for war as they are for peace, because the animal life 
is constantly in a state of war. 

There are two great forms of organization in nature ; that found in 
animal life and that found in the life of plants. I have often stood and mar- 
veled before one of the great trees of California, that rooted in one spot, 
unable to move away, for thirty-five hundred years, have been able to with- 
stand the storms, the fires, and droughts and every other catastrophe which 
came to it. Certainly we can find in nature examples or organization or 
models of organization that we have not yet found in humans. 

There is one animal that I recall, the dodo, that lived on the island of 
Mauritius. There were no animals there to prey on it, no men to hunt it, 
so that it lost the power of flight, it lost the power of offense, and the moment 
sailors came to that island the poor dodo became extinct. That is the only 
case I know in nature of an animal becoming so defenseless that it went 
down and out the first moment any enemies appeared. 

There is a form of organization that has had to withstand these stresses 
of nature, where no nonsense will do, and that is the organization you find 
in the ships at sea. And why is that? That is one of the most model forms 
of organization of which I know, and because those who had a different 
kind of organization never came back to perpetuate it. It was an organi- 
zation that had to stand up under stress and under difficulty. And it is not 
a democracy, — that is what I want to say here. Do not comfort yourselves 

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The Importance of the Human Factor in Industrial Preparedness 

with the idea that this is a fight between democracy and autocracy. That 
is not the kind of fight we are entering into. We are entering into a fight 
of a wise democratic autocracy against an inept bureaucratic autocracy. We 
had upon our side in Russia an inept bureaucratic autocracy, and it went 
down. We have in Germany an unmoral autocracy. That is its fault. But 
its strength nevertheless lies in the fact that it is an autocracy, and we all 
know as we stand here today that England has become autocratic, that 
America is autocratic today. 

Professor Van Hise in his talk has pointed out how we have had to 
give powers that were never before thought of in our government, and if 
we are to win, it is because we are going to delegate autocratic powers to 
some central power that can see it through. 

We cannot afford in this fight not to take a lesson from our enemies. 
We cannot afford to allow them to beat us out, because they have a cen- 
tralized power that is necessary and always has been necessary and always 
will be necessary to carry on a great struggle of life and death. (Applause.) 

PRESIDENT KESSLER: The next speaker is Mr. C. E. Knoeppel, 
President of the C. E. Knoeppel Company, Counsel on organization and man- 
agement, of New York, better known through his classic on Industrial Pre- 
paredness and Maximum Production. Mr. Knoeppel will say a few words 
on the relation of industrial engineering to the government. (Applause.) 

MR. KNOEPPEL: Mr. Chairman, Ladies and Gentlemen: It has 
been my good fortune to be in a somewhat close association with Mr. Coffin 
of the Council of Defense, and through correspondence and conferences in 
Washington, I have had an opportunity to give some attention to analyzing 
the workings of that Council of Defense with its advisory commissions and 
boards. 

Without desiring to throw any bricks, I feel that the Council of De- 
fense with its advisory commissions and boards is a good deal like the 
little girl who asked her mother if she could go swimming, and the mother 
replied, "Certainly, daughter, you can go in swimming, but you cannot go 
near the water." That in a measure is the position the Council occupies today. 
Upon close analysis, its advice, made up of wonderful brains, has accom- 
plished a great many things, to be sure, but the big things it would like to 
do it is prevented from doing. 

In one large plant making dirigibles, I was told by one of their men in 
the plant that they could do twice as much in their line of work if it were 
not for the interference of government officials that have charge of that 
phase of the work. An arsenal head was forced to give and place an order 
on his own initiative, without knowing exactly what the real plans were, 
in order to keep the plant, which was holding up its capacity and complete 
equipment for Uncle Sam busy, even though the allied commission was beg- 
ging to have the plant turned over to them for a number of years. 

There was one company with a large organization of men and equip- 
ment all waiting for Uncle Sam that got an order for three days' production. 

All through it you can see there is no intelligent or comprehensive plan 
from the top down with reference to this very question of getting ready for 
war, and it is largely due to the fact that we have the politicians and bureaus 

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Western Efficiency Society Conference 



to deal with. We have got to do something if we are going to win the war. 
In the latter part of March, Mr. Coffin and I talked over certain phases of 
the production situation, and he asked me for a list of all available engineers 
in the country, in our line of work particularly. I could not give it to him, 
because I did not have it. He then asked for a committee, to name a com- 
mittee of men to serve on these production problems. A committee was 
named, and then he asked for a national organization that would give the 
government contract with the industrial type of engineer. I felt I could 
not do that as an individual, for obvious reasons, but fortunately your West- 
ern Society was giving serious thought to the very self-same problems and 
how to give the government the mechanism which the government through 
its Council of Defense required. The industrial engineers which we 'are 
speaking of for this work, — I might explain it in this way, that the mechan- 
ical, electrical, chemical and civil engineers have to do with the physical 
side of things. To my way of looking at it the industrial engineer is the 
one who correlates all of them. 

My five minutes is just up but I want to read this final letter from Mr. 
Coffin to this conference, which may interest many who did not hear it 
the other day: 

"Our country is embarking upon an industrial and military activity 
which bids fair to tax even its tremendous resources to the limit. Our task 
is not one of a month or of six months, but may extend over a period of 
years. There can be no withdrawal from the position which we have taken. 
No other issue than that of victory will be acceptable to us. But to achieve 
this result, we must be prepared to concentrate our every effort and every 
ounce of our great power, both in materials and in men. 

"It lies within the province of our efficiency engineers to play an im- 
portant part in this great work. To conserve our resources and to make 
efficient our expenditures in effort, in money, in materials, and in men, will 
sooner or later require the concentration of our industrial engineers in every 
line. 

"To effect a national organization of such character as will provide to 
the government a single channel of contact with that group of men pecu- 
liarly skilled in the promotion of industrial efficiency, should be the greatest 
work of the Chicago conference." (Applause.) 

PRESIDENT KESSLER: The relation of the engineer to war will 
be the subject of a speech by Mr. Gilbreth, who has made himself famous 
through his mocro-motion work in this country and abroad. (Applause.) 

MR. GILBRETH: Speaking of efficiency engineering, I would like 
to call the attention of the people here that this is the second time I have 
had a new subject sprung on me today. (Laughter.) 

I don't know anything about the relation between the engineer and the 
war tonight, for the reason that I am carried away with the speech that we 
have heard, and I congratulate my fellow members and their guests of the 
Western Efficiency Society who have heard this talk by Dr. Van Hise. (Ap- 
plause.) 

I have had exceptional opportunity to study this thing, as I told you 
today. I have crossed eighteen countries in Europe since the war. I have 

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The Importance of the Human Factor in Industrial Preparedness 

been back and forth twice, and I have had the distinction of having not 
one detective following me around, but two, fearing I might have some 
allegiance with some foreign country. However, they found they were 
mistaken. (Laughter.) 

But I have had an exceptional opportunity to study this subject and I 
consider the speech that I have heard tonight epoch-making. President Van 
Hise of the University of Wisconsin has a record behind him of being ahead 
of his times. I hope that is not an Irish bull, having a record behind him 
of being ahead of his times. There is not one flaw in what he said, as I 
see it; — that is, with the exception of one. I never can agree with him, much 
as I like him and admire him, his suggestion that he would prosecute under 
the Sherman law any man who hoards the onion supply. (Applause and 
laughter.) 

PRESIDENT KESSLER: The next speaker will be Mr. Berndt, the 
manager of the Betterment Department of Joseph T. Ryerson & Son. Mr. 
Berndt has also been chairman of the Executive Committee of this con- 
ference. He will speak for a few minutes on the results of the conference. 
(Applause.) 

MR. BERNDT: Mr. Chairman, Members of the Western Efficiency 
Society and Ladies and Gentlemen : When we opened this conference I was 
asked to say in a few words something about the purposes of the conference. 
One of the things I said that it was our idea to dedicate this conference 
to a constructive work. I wonder whether we have not been too modest. 
I believe that the conference has been more than constructive. It has 
made history. I cannot see otherwise. 

I think the Western Efficiency Society has a right and can be justly 
proud of meetings such as we have had, and if we had had no other meet- 
ing than the one tonight and heard no other papers than this paper tonight, 
all the efforts, all the plans would have been well repaid. (Applause.) 

Added to this, and going back meeting to meeting, such meetings as 
this afternoon's program, when besides such speakers as Mr. Porter, Mr. 
DeField, Mr. MacArthur, we heard from Mr. Frank Gilbreth when he told 
us so much about the possibility of applying that invention and those 
mechanisms for which he is so well known to this problem of industrial 
preparedness, and we had again done, I believe, a real constructive work and 
made some more history. 

Then looking back to last night's program when we were so fortunate 
in having here with us a man who is distinguished and so capable of repre- 
senting labor's viewpoint, and not only that, we had under one roof the men 
who so ably discussed this labor view-point from all sides, including Mr. 
Barth, Mr. Emerson, Mr. Knoeppel, Mr. Porter and Mr. Gilbreth, it seems to 
me that has some analogy to the co-operation of which the chairman spoke 
on the English labor boards. 

Then again, yesterday afternoon, when Mr. Grieves and Earl Dean 
Howard spoke on that very important problem, the employment problem, 
and we were told about the wonderful possibilities in co-operation there 

o 0"3 1J1 

And back again to Wednesday night's program, when we heard about 

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Western Efficiency Society Conference 



educating the management to the human factor, from Mr. Emerson, Dean 
Hotchkiss, Mr. Dietz and Mr. Puckett. And we hardly need add the first 
and opening session, when Mr. Knoeppel opened the conference and brought 
to us the letter and the good wishes of Mr. Coffin, besides the great fund 
of information which he had collected and given to us. 

It seems to me that we will have done something that can be remem- 
bered for years to come. 

Then besides all this, we have had the round-tables, and last, but not 
least, the exhibits, in which, I believe, have been indicated two special points ; 
one, the great constructive work which has been done and, two, the present 
co-operation among the industries, when they permit the results of their 
work to be shown together in one room. 

One other thing which I suggested as a result of this conference is a 
permanent organization of the men and thought brought out in this con- 
ference. This is planned for tomorrow morning at 10 o'clock in the organ- 
ization of The Society of Industrial Engineers, which it was hoped would 
provide the point of contact mentioned by Mr. Knoeppel in the letter from 
Mr. Coffin. 

A committee has been meeting regularly as often as possible, and for 
as long a time as possible, considering this organization. On this committee 
it has been our privilege to have the advice and counsel of Mr. Emerson, 
Mr. Knoeppel, Mr. Gilbreth, and Mr. Porter, and it would seem a queer- 
occurrence if after having all this talent we could not organize and satisfy 
Mr. Coffin's wishes. 

We have met and we have made plans for tomorrow. We have at- 
tempted in these plans to follow Mr. Emerson's suggestions regarding using 
the natural organizations. 

Just a few words about the American Society of Industrial Engineers 
as was originally planned. Since that time the committee has broadened 
and now we think we have a right to call it "The Society of Industrial 
Engineers." 

I am going to read a statement of the objects: 

1. A National Organization. — There are in existence today in various 
parts of the country 20 or 30 societies and organizations which are primarily 
interested in the study and promotion of Industrial Engineering. A coor- 
dination of the ideals and aims of all these organizations in a representative 
central body, will alone make it possible to give the study of efficiency in 
industry and the science connected with the solution of industrial problems, 
or in other words, Industrial Engineering, the position it deserves among 
the arts and sciences of the world. 

2. Local Organizations. — Each individual organization has its own par- 
ticular and peculiar field of study, research and activity. A national organi- ~j 
zation should in no way change this except in so far as the exchange of 
views and ideas may influence one or the other of the local bodies to make 
changes on its own initiative; nor is it expected that the national body 
should change the local control, management or direction in any way, al- 
though here again such changes may be initiated by a local society after a 
consideration of the organization's plans of all the others. 

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The Importance of the Human Factor in Industrial Preparedness 



The national organization, being interested in the broader movement 
for national standardization of the principles and fundamentals of industrial 
management, should, however, serve to inspire and strengthen each local 
organization to a broader conception of the value and importance of its local 
activity and influence it to a more aggressive program. 

Because of its nation-wide effectiveness such a national organization 
should also influence and inspire the forming of many new local bodies for 
the study and promotion of Industrial Engineering, guiding and supporting 
them through their early years. 

3. Individual Members. — Individuals should be permitted to affiliate 
with the national organization only through membership in a local body. 
The fact that such local body is a part of the national society would, however, 
without doubt, increase the value of membership in the local organization 
and would moreover tend to give such general publicity to the work of each 
group as would promote its membership. 

If the work of the Industrial Engineer is to be made a profession, a code 
of professional ethics must be established. This is obviously an important 
work for the national society to perform. Every right-minded person who is 
engaged in this line of endeavor must see the need for this, and there can 
be little doubt that he would not support through membership in local 
groups such national activity as would tend to place his daily work on a 
professional and ethical plane. 

4. Education.— As yet there are available no standards satisfactory to 
all which can be applied to the work of educating the students who desire 
to follow Industrial Engineering. A national organization should be an 
important influence in the establishment of such standards and should co- 
operate with those educational institutions which are interesting themselves 
in the teaching of this profession. 

5. General Influence. — Industrial Engineering in actual everyday prac- 
tice is only in its infancy, although it is gaining recognition day by day. 
Before it receives the universal recognition it deserves and is practiced as 
such in all of our industries, a national organization must be formed to estab- 
lish standards of practice, accepted principles, and recognized theories, and 
to give them wide publicity, educating all factors in industry to their value. 
National conferences would do much in this direction. 

6. Government Influence. — In such national emergencies as the present 
and even during normal periods, an invaluable service would be rendered 
to our country, state or city if a well established and organized body of 
engineers were available, to which our various governments could turn for 
necessary counsel, service, and support in the solution of industrial problems. 

That is a proposed statement of the objects for this new organization. 

Briefly, the proposed membership classes are as follows : 

1st: Managing executives in industry, 

2nd: Professional industrial engineers, including those retained and 
those resident, 

3rd : Educators, including writers, lecturers and teachers. 

By this membership plan we know we will have left out many other 
possible members, but it was thought at this time in the recent emergency 

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Western Efficiency Society Conference 



Ave are interested in those who are themselves immediately interested in the 
problem of industrial preparedness and other possible groups such as juniors 
and students will be planned for later. 

Further, in regard to this proposed organization, a meeting will be held 
tomorrow morning at 10 o'clock on the parlor floor. All of you are invited 
to come and hear the further plans. 

In closing I would like to propose to our president that it would be 
only right for this organization to show its appreciation to all the speakers 
on the program and all those who have entered into the discussions and 
all our guests, in the form of a rising vote of thanks. 

I thank you. (Applause.) 

PRESIDENT KESSLER: I am going to ask Mr. Hill, Efficiency Engi- 
neer of the Berger Manufacturing Company of Canton, Ohio, to say a few 
words on the co-operation of the local resident engineers. (Applause.) 

MR. HILL: Mr. Chairman, Ladies and Gentlemen: This has been my 
first experience with the Western Efficiency Society. It has been a great 
treat and privilege to me to be here at these meetings. 

The idea of coming here only came to me a few days before I actually 
came on. The motive back of that is the motive that I believe is in the 
minds of the ownership of a great many large businesses in this country, 
that they desire, as the English would say, to do their bit. 

The thing is how to do that bit. And it was in hope of learning how 
best to do the bit that our company would like to do, that I came to this 
meeting. 

It is true that the efficiency men who are retained by a number of con- 
cerns, who are in practice for themselves, as I have been in past years, 
until the last year with th Du Pont Company, when I became resident 
efficiency engineer, although not resident long at any one place. 

The scope of this work is very great, as we all realize. It is so great 
that we probably cannot conceive just what it does mean. We have heard 
so many good facts about this thing that I thought in the few minutes 
given me that I would try perhaps to draw your attention to a few things 
that have not been mentioned, which, I believe, could be properly under- 
taken by this new society of Industrial Engineers. 

That is that they could solicit the co-operation not only of the Engineer- 
ing societies which now exist, but also of the societies such as the associated 
advertising clubs, the purchasing agents, the large organizations of sales- 
men, — and I am speaking particularly of those organizations the member- 
ship of which is largely dependent upon the spending of money. Statements 
have been made about the money wasted in advertising. No doubt there is 
a great deal of truth in that. 

Then it also occurred to me that 'efficiency men are perhaps best known 
as professional economists, that if they can reach out and interest these 
other associations whose interests have been largely to do with spending — 
economical spending, if you like, because there is not anything in my 
thoughts of this nation-wide economy which the papers are taking up and 
spreading broad-cast. 

Besides these associations I have named there are at least a half dozen 

209 



The Importance of the Human Factor in Industrial Preparedness 



others that I wrote down that I believe could very well join this member^ 
ship, with perhaps representative members in this proposed society. 

I thank you. (Applause.) 

PRESIDENT KESSLER: This afternoon I was looking over the 
record of registration cards and it was interesting to note that the people 
who have attended this conference have come from one hundred and ten 
cities outside of Chicago, and there are nearly seventy cities represented in 
the attendance at the conference. We have had with us delegates from 
Texas. I notice we have had Mrs. Ellis, a nationally known lecturer, a 
women who has lectured in forty-seven states ; she has been in attendance 
at all meetings. We have had men and women coming from the New Eng- 
land states, Washington and New York, and a great many others states of 
the Union. 

Just before we close I want to call upon Harry Franklin Porter, who will 
speak a few minutes on the attitude of industrial engineers relative to the 
proposed Society of Industrial Engineers. (Applause.) 

MR. PORTER: Mr. Chairman, I think perhaps I had better not talk 
at all, because it is getting so late. All I want to say is that the call is 
come and we want to get ready. 

A year ago, when a certain board was formed, the federal trade com- 
mission got busy and called upon the economists and others to put across 
an idea of economy. I boiled out with rather righteous indignation because 
of the fact we industrial engineers were not recognized and could not get 
our point of view considered. At that time I was connected editorially 
with the Industrial Magazine, now Scientific Engineering, and I wrote an 
article. I was going to read some parts of it, but however, I will mention 
but an instance. 

There are unquestionably great difficulties in the way of putting this 
thing across but these great difficulties can be sunk now in this supreme 
need of the hour. I am sure that most of these ideas are merely tempera- 
mental phases of opinion, so you will bear that in mind as I read this. It 
was written about a year ago. 

"Morris Llewellyn Cooke took a somewhat more hopeful view of the sit- 
uation. While in hearty sympathy with the idea of bringing the organizing 
or management engineers together in a single organization, because of the 
difficulty some of the leading men in the management movement seemed to 
experience in co-operating with others of the same grade, but exactly not 
of the same persuasion, he thought it would take a pretty 'heavy' man to 
bring them together. He thought that there would be grave difficulties in 
determining the requirements for membership in such a society. Like Mr. 
Gantt he believed that organizing engineers ought to be able to find a haven 
in the A. S. M. E. but at the present time that body was opposed to having 
sections. Ultimately he hoped to see all engineers brought together in one 
general body, with sections devoted to the work of different branches. The 
Taylor Society was admittedly limited, and rightly so, in his opinion, be- 
cause his conviction was more and more that it is well worth while that 
this one organization should continue for some time to come to confine 
itself pretty definitely to those who are conversant not only with the phil- 

210 



The Importance of the Human Factor in Industrial Preparedness 

osophy of Mr. Taylor's teaching but also measurably with the mechanism 
through which he sought to make this philosophy operative. 

"In regard to the main statement in the editorial Mr. Cooke said : 'Some 
of the ideas which you so splendidly voice in this article have been in my 
own mind. For instance, it seems a crime that the Federal Trade Com^ 
mission should be considering costs only in their historical aspects. Such 
work as that being done by Day and Zimmerman, which has relatively little 
interest in the historical side, should be among the models.' 

"Mr. Cooke also thought that the leading men in the management might 
well come together at this time to discuss ways and means by which they 
collectively could place themselves at the disposal of the national govern- 
ment to give what aid they might in the preparedness movement. As a 
class the management engineers certainly ought to be helping at the present 
time ; of that there can be no doubt. He would be glad if some disinterested 
agency would take the lead in bringing them together for this purpose. 
He for one was perfectly willing to co-operate." 

This splendid letter is but one of a number of equally splendid letters. 
I am sure that we, as Mr. Berndt so well phrased it, could do no better 
thing at this time to serve our country than bring together these men who 
have made a specialty of harnessing up the forces of engineering and nature 
and science for the sake of getting results and at the same time considering 
the human element and getting results in the right way and right manner 
through the efficiency engineer and industrial engineer. The call has come 
from Mr. Coffin to place this body at the disposal of the government, and I 
think we ought not to hesitate in responding in the right way. (Applause.) 

PRESIDENT KESSLER: I will recognize Mr. A. B. Segur. 

MR. SEGUR: I have a resolution which I would like to offer at this 
time or at least have considered: 

"Whereas, this country is in a state of war with Germany, and the prob- 
lem before it is the adequate preparation for assistance to its allies in win- 
ning the war in the shortest possible time, in order that democracy may 
more quickly be made a world-wide certainty ; and 

"Whereas, it is evident from the lessons of the war to date that indus- 
try, transportation and agriculture are as important in the conduct of this 
war as are the military phases ; and 

"Whereas, from all the available sources of information it is apparent 
that our country not only lacks proper preparation for war, but that there 
exists no comprehensive and constructive plan for mobilizing >our resources 
in men, materials and equipment; and 

Whereas, while there exists a mechanism for the preparation for war 
in the form of the advisory commission of the Council of National Defense 
and its contingent boards, their powers are chiefly advisory, they being 
clothed with responsibility without authority to get things done quickly and 
effectively, and 

"Whereas, the operating section of the country in the form of plants, 
individuals, societies, and organizations should be utilized to the best advan- 
tage, are unorganized and uneducated for the public service, and 

"Whereas, there must be proper coordination between the advisory func- 

211 



Western Efficiency Society Conference 



tion, the government departments having to do with preparing for war, and 
the executive function of the nation in order, that our task in this war may 
be properly performed ; therefore, 

"Be It Resolved, That this Society in National Conference assembled 
urgently recommend to the president, his cabinet ministers and the leaders. 
in Congress, an immediate investigation by organizations, industrial engi- 
neering specialists and business executives of national reputation, of all 
activities having to do with the preparation for war, both in industry and in 
government with the view to perfecting comprehensive plans based on the 
lessons of this war which will place the work in the hands of a strong central 
control, either in the form of an inner-cabinet of a few strong men, or in 
the form of greater powers for a reorganized Council of National Defense." 

Mr. Chairman, I would like to move that this resolution be adopted. 

(The motion was duly seconded, and on being put to the meeting was 
unanimously carried.) 

PRESIDENT KESSLER: One word of appreciation to those who 
have helped us in our exhibits. It is due largely to the efforts of our com- 
mittee on exhibits, Mr. Ford, Chairman, that it has been such a success. 
We want to thank Mr. Latta, of the Underwriters for the pictures we 
saw just preceding this meeting tonight. 

Before we adjourn we would like to hear a second to the motion that 
was made by Mr. Berndt, that a hearty vote of thanks be extended to those 
who assisted in the program of the conference, and I am going to ask not 
only our members, but our guests and friends, to give a rising vote of thanks 
to those named. 

(The motion was duly seconded and a rising vote of thanks was given 
to the speakers of the conference.) 

The meeting then adjourned. 



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